The Narendra Modi led government Demonetized highest value currency notes of Rs 1,000 and Rs 500 in November 2016. India primarily being a Cash Economy of which 50% is the parallel Black Money Economy, suffered during demonetization as their was total chaos on the availability of cash. Citizens had to rely on their Debit Cards or Credit Cards to transact at Point of Sale [POS].
We have obtained data from RBI and presenting the same here. We are only considering the Point of Sale Transactions for this study as this is actual transaction on Sale of Goods / Services. The following Chart shows Transactions and Amount in the month of Nov & Dec for 2014, 2015 and 2016.
Total Debit Cards Outstanding at the end of Dec 2016 in India is a whopping 76,11,23,366. You can see that the Debit Card Transaction Volume and data saw a 300% spike in 2016 when compared to previous year. . From the above chart it is evident that Indians who spent Rs 29,482 Cr in the months of Nov & Dec 2015 collectively, increased their spending drastically to Cashless Mode in the Month of Nov & Dec 2016 and spent a whopping Rs 90,205 Cr in 2016.
Total Credit Cards Outstanding at the end of 2016 in India is 2,83,21,039. Spending on Credit Cards during Demonetization of 2016 increased in Volume by 158% and Amount by 137% respectively when compared to Nov & Dec 2015 data. The following chart shows Credit Card spend of Indians in the months of Nov & Dec of 2014, 2015 and 2016.
We know that Mobile Money was some contributing factor but RBI does not have accurate data on PoS transactions using Mobile Money thus the same has been excluded from our study but we will definitely strive to get the data and present it to our viewers. It is time to go Cashless and Mobile when transacting. Hopefully, the government will continue its initiative to eliminate Black Money forever.