ABSTRACT
An important transition in the government's propaganda in support of the disastrous demonetisation drive was a push to cashless transactions, principally through digital payments of different kinds. A Reserve Bank of India (RBI) Press Release of 12 November 2016 sought to transfer the problem of ensuring a smooth payments system on to the public that was suffering from the inadequacy of currency. More than 90 per cent of economic transactions are still conducted with cash in India. There is really no relation between per capita income and the value of currency in circulation, or between levels of corruption and cash in circulation. It is true that countries like Sweden, which make extensive use of digital payments, have lower proportions of cash in circulation relative to money GDP. Experience shows that the transition to a cashless economy tends to be slow, influenced to a considerable degree by the extent of banking spread.
