New Delhi, December 8 (UNI) Notwithstanding the demonetisation in November, 2016, the currency in circulation (CiC) in the country has more than doubled between 2016 and 2025.
While the CiC in the country was Rs 17.97 lakh crore at the time of the demonetisation that happened on November 8, 2016, the CiC in the country as on October 17, 2025 stood at Rs 38.29 lakh crore.
This was informed by Minister of State for Finance in the Lok Sabha on Monday in reply to a question on the effectiveness of demonetisation and its impact on the intended goals of curbing black money, counterfeit currency and promoting digital transactions.
Although the CiC in the country went down to Rs 10.71 lakh Cr in the first year of the demonetisation, it again rose gradually in subsequent years.
The CiC includes Banknotes in circulation, the digital rupee and Coins.
The Minister said that the the currency in circulation is a function of demand from the public or the economy. The demand for currency also depends upon several macroeconomic factors including economic growth and level of interest rates.
While stating that the government hasn’t done any study to assess the impact of the withdrawal of certain legal tenders as part of demonetisation, the minister informed that the Reserve Bank had released a study titled ‘Macroeconomic Impact of Demonetization – A Preliminary Assessment’ in March, 2017.
The mission of the government, the Minister said, was to move towards a “less cash economy” to reduce generation and circulation of black money and to promote digital economy.
Citing the National Accounts Data of the Ministry of Statistics and Programme Implementation, the Minister said that the economic growth momentum of the country continued despite demonetisation with average rate of growth of the economy remaining at 7.3 per cent between 2016-17 and 2024-25, excluding the pandemic affected years of 2020-21 and 2021-22).
Liquidity conditions also remained stable in the years after 2016-17. Broad Money (M3), a key indicator of liquidity, grew at an average rate of 8.0 per cent during 2016-17 and 2017-18, and at about 9.6 per cent on average between 2016-17 and 2024-25, the Minister stated.
With government encouraging digital economy and payments, the Minister said that the average monthly UPI transactions have grown from Rs 579 crore in 2016-17 to over Rs 25.2 lakh crore in 2025-26 (up to November 2025).
