Summary
- • 86% of currency in circulation was demonetized
- • 99% of demonetized notes returned to banking system
- • GDP growth rate fell from 8.2% to 7.1% in 2016-17
- • 11 million jobs were lost in 2018 due to demonetization
- • Cash to GDP ratio fell from 12% to 8% post-demonetization
- • Digital transactions increased by 55% in 2016-17
- • UPI transactions grew by 1,342% in 2017-18
- • Number of POS terminals increased by 84% in 2016-17
- • 2.24 lakh fake currency notes detected in 2016-17
- • Fake currency detection increased by 20.4% in 2016-17
- • Income tax returns filed increased by 25% in 2016-17
- • Number of new taxpayers increased by 9.1 million in 2016-17
- • Tax to GDP ratio increased from 10.6% to 11.6% in 2016-17
- • Bank deposits increased by 14.5% in 2016-17
- • Credit growth fell from 10.9% to 8.2% in 2016-17
Money talks, but demonetization statistics scream! Imagine a world where 86% of currency in circulation vanishes into thin air, only for 99% of it to magically reappear in the banking system. From a rollercoaster of GDP growth rates to a whirlwind of job losses, the demonetization saga in India was nothing short of a financial circus. Join us on a wild ride through the numbers, where cash dwindled, digital transactions soared, and counterfeit notes played a game of hide and seek with the authorities. Buckle up, because this financial rollercoaster is about to take you on a statistical joyride!
Banking Sector
- Bank deposits increased by 14.5% in 2016-17
- Credit growth fell from 10.9% to 8.2% in 2016-17
- ATM withdrawals decreased by 12% in 2016-17
- Bank account openings under Jan Dhan Yojana increased by 27% in 2016-17
- Non-performing assets of banks increased by 56.4% in 2016-17
- ATM transactions decreased by 18% in volume in 2016-17
- Bank credit to industry sector grew by only 0.7% in 2016-17
- Bank credit to services sector grew by 16.9% in 2016-17
- Bank credit to agriculture sector grew by 12.4% in 2016-17
Interpretation
Demonetization in 2016-17 was like a whirlwind romance - some saw their fortunes rise with increased bank deposits, while others experienced a sharp decline in credit growth. As ATM withdrawals dwindled, the Jan Dhan Yojana saw a surge in new bank accounts, painting a mixed picture of financial evolution. With the rise in non-performing assets revealing a harsh reality, the decrease in ATM transactions and sluggish bank credit growth to industries hinted at a bumpy ride ahead. However, the services and agriculture sectors emerged as the unlikely heroes, showcasing resilience amidst the chaos. Like any good drama, demonetization left its mark on every character in the financial narrative, making it a tale worth analyzing and learning from.
Counterfeit Currency
- 2.24 lakh fake currency notes detected in 2016-17
- Fake currency detection increased by 20.4% in 2016-17
- Counterfeit notes of ₹500 denomination decreased by 37% in 2017-18
- Counterfeit notes of ₹2000 denomination increased by 21% in 2017-18
- Counterfeit notes detected per million pieces of currency decreased from 7.1 to 5.5 in 2017-18
- Value of counterfeit notes detected decreased by 27% in 2017-18
- Counterfeit notes detected in the banking system decreased by 31.4% in 2017-18
Interpretation
As the saying goes, "the real vs. the counterfeit - a tale as old as money itself." The demonetization rollercoaster of the past few years has certainly provided its fair share of twists and turns for India's currency connoisseurs. With a whopping 2.24 lakh fake currency notes unmasked in 2016-17, one can't help but marvel at the audacity of counterfeiters. However, the slight decrease in counterfeit notes of ₹500 denomination by 37% in 2017-18 suggests perhaps our modern-day scammers need to brainstorm new strategies, while the surge in fake ₹2000 notes by 21% indicates that some miscreants are shamelessly upping their game. But fear not, dear readers, for the overall detection rate of counterfeit notes per million pieces of currency has dipped from 7.1 to 5.5, showing that our financial watchdogs are not to be trifled with. In this high-stakes game of cat and mouse, where numbers never lie and the stakes are higher than ever, one thing's for certain - fake may be fleeting, but the truth always finds its way to the surface.
Currency Impact
- 86% of currency in circulation was demonetized
- 99% of demonetized notes returned to banking system
- Cash in circulation fell by 20.8% in 2016-17
- Currency printing cost increased by 79.65% in 2016-17
- Currency in circulation took 2 years to reach pre-demonetization levels
- ₹15.28 lakh crore worth of old notes were deposited during demonetization
- Currency with the public decreased by 20.2% in 2016-17
- Cost of printing new currency notes was ₹7,965 crore in 2016-17
Interpretation
In a bold move, demonetization saw a whopping 86% of currency in circulation rendered useless, only for a staggering 99% of it to resurface through the banking system. As cash seemingly disappeared into thin air, cash in circulation took a nosedive by 20.8%, but the cost of printing new currency skyrocketed by 79.65%. It took a painstaking two years for currency levels to recover, while an eye-popping ₹15.28 lakh crore worth of old notes made their way back into the system. An expensive experiment indeed, as the public saw their cash holdings diminish by 20.2%, with a hefty ₹7,965 crore spent on printing new bills. The numbers may not lie, but they certainly paint a pricey picture of policy in practice.
Digital Payments
- Digital transactions increased by 55% in 2016-17
- UPI transactions grew by 1,342% in 2017-18
- Number of POS terminals increased by 84% in 2016-17
- E-wallet transactions increased by 435% in 2016-17
- BHIM app downloads reached 12.5 million by March 2017
- Debit card transactions at POS increased by 108% in 2016-17
- Mobile banking transactions increased by 151% in 2016-17
- NEFT transactions increased by 33% in volume in 2016-17
- RTGS transactions increased by 16% in volume in 2016-17
- RuPay card transactions increased by 118% in 2016-17
- IMPS transactions increased by 150% in volume in 2016-17
- Digital payments as a percentage of total transactions increased from 6% to 14%
- UPI transactions increased from 0.3 million in November 2016 to 17.9 million in March 2017
- BHIM app transactions reached ₹823 crore by March 2017
Interpretation
The demonetization move in India seems to have sent digital transactions soaring to new heights, like a rocket fueled by the power of necessity. With numbers shooting up faster than a pop star's Instagram following, it's clear that the era of waving physical cash for goodbyes is on the horizon. From BHIM app downloads skyrocketing to wallet transactions taking flight, it's safe to say that in the battle of cash versus tech, the latter is emerging as the knight in shining armor. So, while the skeptics may still cling to their notes and coins, the data tells a different story - one where convenience, security, and a touch of digital magic take center stage in the grand theater of modern finance.
Economic Impact
- GDP growth rate fell from 8.2% to 7.1% in 2016-17
- 11 million jobs were lost in 2018 due to demonetization
- Cash to GDP ratio fell from 12% to 8% post-demonetization
- MSME sector growth rate fell from 7.62% to 1.17% in 2016-17
- Real estate prices fell by 5-20% across major cities
- Gold imports increased by 104% in value terms in 2016-17
- Manufacturing sector growth rate fell from 8.3% to 7.9% in 2016-17
- Agriculture sector growth rate increased from 0.6% to 6.3% in 2016-17
- Services sector growth rate fell from 9.6% to 7.7% in 2016-17
- Household savings rate fell from 9.1% to 7.1% of GDP in 2016-17
- GDP growth rate in Q3 2016-17 fell to 6.9% from 7.4% in Q2
- Informal sector, accounting for 40% of GDP, was severely affected
- Consumer confidence index fell from 108.7 in September 2016 to 95.1 in December 2016
- Number of new mutual fund investors increased by 70% in 2016-17
- Household financial savings increased from 8.1% to 8.9% of GDP in 2016-17
Interpretation
Demonetization, like a mischievous genie, granted some wishes while leaving a trail of chaos in its wake. The GDP growth rate may have stumbled, jobs vanished like a magician's trick, and sectors jostled in a delicate dance of gains and losses. Real estate prices saw a rollercoaster ride, while gold imports glittered brightly. Amidst the turmoil, agriculture witnessed a rare bloom and household savings played a game of hide and seek. The informal sector bore the brunt, like a forgotten character in a novel, while consumer confidence spun a tale of twists and turns. Perhaps demonetization was a necessary evil, a plot twist in the grand narrative of our economy, reshaping destinies and narratives in its wake.
Tax Compliance
- Income tax returns filed increased by 25% in 2016-17
- Number of new taxpayers increased by 9.1 million in 2016-17
- Tax to GDP ratio increased from 10.6% to 11.6% in 2016-17
- Direct tax collections increased by 14.5% in 2016-17
- Number of tax returns filed increased by 17.3% in 2017-18
- Number of suspicious transaction reports increased by 345% in 2016-17
- Corporate tax collections increased by 7% in 2016-17
- Number of PAN card applications increased by 17.7% in 2016-17
- Tax-GDP ratio reached 11.6% in 2016-17, highest in a decade
Interpretation
In a world where statistics are more elusive than unicorns, the demonetization saga emerges as an unexpected hero in the battle against tax evasion. With a cast of characters including a 25% surge in income tax returns and a dazzling 9.1 million debutantes joining the taxpayer club, the script unfolds with a plot twist that sees the tax to GDP ratio reaching a milestone 11.6%. As the curtain falls on suspicious transaction reports skyrocketing by 345%, one thing is certain: the demonetization drama has not only boosted tax collections but also unearthed a treasure trove of new players in the taxpaying game. The sequel promises more twists and turns as the narrative of fiscal responsibility continues to captivate audiences.
