Currency in circulation rises 13.5% between February 10 and March 10

MUMBAI: Currency in circulation has risen 13.5% in one month between February 10 and March 10 and is at Rs 12.46 lakh crore as of March10, according to latest Reserve Bank of India data.

Even as normalcy was expected by February end, at the current levels, the total currency in circulation is at 70% of the early November levels before the Reserve Bank of India banned Rs 500 and Rs 1000 notes as legal currency.

The Reserve Bank of India injects currency notes of various denominations in the system according to the demand from time to time. Though over the years efforts have been towards lesser dependence on cash by moving to banking and other digital modes of transaction, cash demand is known to spike at times of elections and in years when monsoons and agricultural output has been good. This is because rural economy is predominantly cash-based.

Among the various justifications for the note ban, the government has also been pushing for a lesser cash dependent economy. After the note ban, the government also launched mobile applications to promote digital payments even by the rural poor.