Demonetisation encouraged Digital Payments: Rajiv Kumar, VC, Niti Aayog

31 Aug
Demonetisation encouraged Digital Payments: Rajiv Kumar, VC, Niti Aayog

 

Prime Minister Narendra had Modi on November 08, 2016 announced that from next day onwards existing Rs. 500 and Rs. 1000 notes will be a legal tender.

 

Demonetisation of high value currency (Rs. 500 and rs. 1000) in November 2016 helped reduce cash transaction and encouraged digital payments, Rajiv Kumar, Vice Chairman, Niti Aayog said. 

 

At the time of demonetisation, which among other things aimed at checking black money, about 86-87 per cent of the total currency in circulation was in the form of Rs 500 and Rs 1,000 notes. 

 

As per the RBI Annual Report for released, 99.3 per cent of the demonetised Rs 500 and Rs 1,000 notes were returned into the banking system.  Rs 15.41 lakh crore worth Rs 500 and Rs 1,000 notes in circulation on November 8, 2016, when the note ban was announced, currency worth Rs 15.31 lakh crore has returned to the banking system. 

 

The government is committed to fiscal discipline and pointed out that the Prime Minister resisted the pressure to cut down excise duty on fuel while the oil prices were on rise, Kumar added. 

 

He further added that retail inflation, which includes fuel and food, is lower than core inflation. 

 

"So inflationary impact of an oil price rise, or that of minor exchange rate decline is not that high, because there can be a supply response to that. Inflation is well under control. We are constantly on vigil on these issue," Kumar added.