New Delhi: Currencies with the public has reached a record high of over Rs 18.5 lakh crore which is more than double the low of Rs 7.8 lakh crore hit after the government banned 500 and 1000 rupee notes in 2016, the Times of India reported citing RBI data. The total currency put in circulation by the RBI has also more than doubled to over Rs 19.3 lakh crore — from a low of about Rs 8.9 lakh crore post-demonetisation, the TOI report further said.
However, as a percentage of GDP the proportion remains much lower than the pre-demonetisation level. Currency with the public is equal to total currency in circulation minus cash with banks.
It may be noted that there was a cash crunch reported in various parts of the country few months ago which is in contrast with the high levels of cash available with the public. Hoarding of cash was then cited as a possible factor that could have triggered an artificial currency crunch.
The figures for both ‘currency with the public’ and ‘currency in circulation’ have exceeded the levels seen before the demonetisation that saw nearly 86 per cent of the currency in circulation at that time being invalidated overnight by scrapping the then 500 and 1,000 rupee banknotes, the TOI report said.
Till June 2017, people had returned Rs 15.28 lakh crore to banks or nearly 99 per cent of the banned notes. Since then RBI has introduced new Rs 2,000, Rs 500 and Rs 200 notes among others.
According to RBI’s latest data, currency with public at over Rs 18.5 lakh crore was more than 31 per cent higher than the year-ago level.