Despite the rapid growth of wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital payment systems like Unified Payments Interface (UPI) in India, the country's cash circulation remains remarkably high, totaling ₹34.7 lakh crore. While wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital transactions have gained immense popularity for their convenience and ease, the reliance on cash remains strong across various segments of society, especially in rural and semi-urban areas. Cash is deeply ingrained in the culture, with physical currency often seen as a safer and more straightforward option. As a result, despite the push towards a “Digital India,” physical currency continues to hold a central place in the financial lives of millions.
The cost of printing currency notes is a significant factor in maintaining such a vast cash economy. For example, printing a ₹10 note costs around ₹0.96, while a ₹500 note costs ₹2.29, meaning billions of rupees are spent each year to meet the demand for cash. As denominations increase, so does the printing cost, with notes like ₹200 costing ₹2.37 to produce. This expenditure adds up considerably, especially as the reserve bank of india (RBI) has to regularly print new notes to replace worn-out ones. Thus, while wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital transactions might seem more cost-effective in the long run, the preference for cash imposes significant costs on the indian economy in the form of currency production and distribution.
The coexistence of a growing wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital payment ecosystem alongside high cash usage presents unique challenges and opportunities. On one hand, UPI transactions have surged, showing a promising shift towards cashless transactions, especially among urban and tech-savvy populations. On the other, the infrastructure to support a fully wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital economy is still developing, and cash remains essential in areas where internet connectivity is limited or wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital literacy is low. The government and RBI are working to strike a balance, encouraging wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital adoption while ensuring access to cash where necessary. This dual approach reflects the diversity of India’s financial landscape, where both cash and digital payments play essential roles in catering to the varied needs of its population.
The cost of printing currency notes is a significant factor in maintaining such a vast cash economy. For example, printing a ₹10 note costs around ₹0.96, while a ₹500 note costs ₹2.29, meaning billions of rupees are spent each year to meet the demand for cash. As denominations increase, so does the printing cost, with notes like ₹200 costing ₹2.37 to produce. This expenditure adds up considerably, especially as the reserve bank of india (RBI) has to regularly print new notes to replace worn-out ones. Thus, while wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital transactions might seem more cost-effective in the long run, the preference for cash imposes significant costs on the indian economy in the form of currency production and distribution.
The coexistence of a growing wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital payment ecosystem alongside high cash usage presents unique challenges and opportunities. On one hand, UPI transactions have surged, showing a promising shift towards cashless transactions, especially among urban and tech-savvy populations. On the other, the infrastructure to support a fully wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital economy is still developing, and cash remains essential in areas where internet connectivity is limited or wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital literacy is low. The government and RBI are working to strike a balance, encouraging wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital adoption while ensuring access to cash where necessary. This dual approach reflects the diversity of India’s financial landscape, where both cash and digital payments play essential roles in catering to the varied needs of its population.
click and follow Indiaherald WhatsApp channel