A study on objectives of demonetisation and its impact on banking patterns and e-transactions Sharma Nidhi1,*, Muni Akash Deep2 1Welfare Officer, Guru Angad Dev Veterinary and Animal Sciences University, Ludhiana, Punjab, India 2Lovely Professional University, Phagwara, Punjab, India *Corresponding author: sharmanidhi2005@gmail.com
Online Published on 16 October, 2023. Abstract Economic histories are replete with examples of demonetisation done in various countries. While in some countries demonetisation scripted success stories, it proved to be disastrous elsewhere. Countries like America, Ghana, Nigeria, Myanmar, Soviet Union, North Korea and Iraq opted for demonetisation due to political motives or economical reforms. In India, Prime Minister Narendra Modi announced ban on currency notes of  500 and 1000 on November 8, 2016. The event was widely covered by the newspapers in the country and hence played a larger role in shaping the public perception about demonetisation. The major objective of this paper is to acquire a better understanding of public perception about objectives of demonetisation besides assessing the changes in banking patterns and advent of digitalization of economy. For the study, a sample of 600 respondents was taken from Punjab with equal representation of males and females. A questionnaire was served to them to understand the respondents’ perception they developed after reading newspapers about demonetisation in India. The study revealed that an overwhelming majority i.e. 76.2 percent perceived ‘elimination of black money and corruption’ as the prime objective followed by wiping of fake currency. A little more than half of the respondents believed that the main objective behind currency ban was to weed out drugs and terrorist funding. Interestingly, only 27 per cent perceived that promotion of Digital India and curbing tax evasion was the key objective of demonetisation. Still, a vast majority i.e. 72 percent people agreed that use of various banking apps reduced personal visits to banks and the cashless transactions lowered the risks of theft and snatchings. On the other hand, the study also revealed that over 72.8 per cent of the respondents believed that digitalization of economy led to increase in online frauds. Highlighting another issue, more than 70 percent of the respondents believed bank employees adopted ‘pick and choose’ policy while dealing with general public as well as they found the cash withdrawal and deposit process toughest ever. As many as 84.5 percent among respondents opined that digital transactions increased substantially post demonetisation thus resulting in more benefits in terms of discounts, cash backs for common man during e-transactions. Interestingly, while 78.3 percent respondents expressed privacy concerns about modes of e-transaction, 67.8 percent found security violations as key challenge in adopting digitalization of payment methods. An in-depth analysis of the responses brought to the fore that nearly 40.7 per cent of respondents were unaware about techniques of digital modes of transactions and 49.6 per cent of the respondents believed that digital payment methods were too complex and confusing. Top Keywords Demonetisation, Black money, Fake currency, Corruption, Currency ban, Digital transactions, Banking pattern, Challenges, Public perception, Newspaper coverage, Discounts, Digital payments, Banks, Benefits, Banking apps, Internet banking, Cash. Top |