Expect your household budget to shoot up: Going cashless comes at a cost

The government’s demonetisation drive has caused a cash crunch, forcing people to look at plastic money and other forms of digital payments. But, for a society accustomed to physical notes, the transition to cashless comes at a cost. Many households are likely to see their budgets shoot up as they pay more at merchant establishments that accept digital payments.

Around 95 per cent of consumer transactions by volume and 65 per cent by value are carried out in cash in India, according to a JM Financial report. “India is still a cash-intensive economy with a cash-to-GDP ratio of over 12 per cent,” the report states. Life has become difficult as the higher-denomination notes of Rs 500 and Rs 1,000 accounted for 86.4 per cent of the total currency in circulation by value as on March 31, 2016, according to the Reserve Bank of India’s data.

  1. Impact on your budget
  2. Household essentials
  3. Travelling
  4. Eating out
  5. Cashless future: Not so near

Read More…


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