A look at how demonetisation impacted the economy: The story in numbers

Cash in circulation rose faster after note ban, up 14%

The Supreme Court, on Monday, ruled that the demonetisation was not unreasonable and stands the “test of proportionality”.  

A Business Standard analysis looks at the outcome and impact of the government’s decision on November 8, 2016, to overnight invalidate Rs 500 and Rs 1,000 currency notes.  

Cash use has zoomed, by a compound annual growth rate of 14.4 per cent, faster than the 12.2 per cent annual growth from 2011 to 2016.   

As a proportion of the gross domestic product (GDP, or the value of all goods and services produced), cash in circulation was more than a percentage point higher in April 2022 than April 2016. 

The high-denomination notes accounted for 87.1 per cent of the total value of the currency in circulation in March 2022, compared to 86.4 per cent in March 2016 

The average growth in fast-moving digital payments (IMPS or immediate payment service, UPI or unified payments interface, wallets, cards) was 44 per cent between 2011-12 and 2015-16. 

The average increase in digital payments was 66 per cent between 2017-18 and 2021-22. 

The average ticket size of UPI — the amount spent per transaction — has declined, but the volume has jumped 123 times between November 2017 and November 2022.