“Impact of Demonetization on

Farmers and Other People from Rural

Background and Their Perception on
Demonetization”

ANAND MOHAN
ARJUN SINGH
DEVANSH BHANDARI
AKASH RANABHAT
ANWAR ASHRAF
 INTRODUCTION
• Demonetization is the process of devaluing a piece of currency to zero. It is
changing the value of denomination of currency to nil, making it a piece of
paper with absolutely no value.

• The scheme, popularly called “notebandi”, was with aim to end the menace
of black money, counterfeit currency, and corruption. Inevitably, low-
income, and rural households have been hardest hit by this currency reform.

• The effects of demonetization have been more worrying in the rural parts of
the country which are even more dominated by cash and which have limited
physical accessibility to banks and other financial institutions. To go at bank
branches in rural areas is still time consuming and costly for common people
at Rural India. Supplementary digital financial services like ATMs and POS
machines at shops are inadequate in number and crippled with
infrastructural issues.
 OBJECTIVE
• The objective of the research is:
• To find out the impact of demonetization on farmers
and the people of rural areas.
• To know about the other payment systems used by
the people in rural areas instead of cash.
• To find out whether they are aware about the other
payment systems like paytm, BHIM app, freecharge
etc.
• To find the viewpoints of farmers and the people in
rural areas about the current situation after two years
of demonetization.
 METHODOLOGY
• Study area mainly included Panchayatan Village of
Uttar Pradesh, India.
• The research was carried out by survey of 20 families
with the help of questionnaires.
• Respondents were selected from heterogeneous
background and diversity in education, annual income
and occupation.
• The questionnaire addresses impact of demonetization
and response of people at initial stage and after two
year of demonetization announcement and subjective
assessment of the policy.
 RESULT

Demonetization Decision Frequency of notes exchanged

communicated through

Other More than 10

6-10 times;
persons; 7.00% times; 1.00%
15.00% 1 time; 29.00%
Social media;
10.00%

News Papers; TV; 62.00%

13.00%

2-5 times;
63.00%
 Time required for Exchange of notes in bank Impact of demonetization on employment/Business

Less than 1 No effect; 12.00%

More than Good; 1.00% Very Bad; 26.00%
hour;
4 hours;
11.00%
24.00%

2-3 hours;
36.00%
3-4 hours;
29.00% Bad; 61.00%
 Impact of demonetization on monthly income Impact of demonetization on availability/purchase of daily household needs

No effect; 17.00%
Very bad; 24.00%
Can't Say;
17.00%
No
change;
19.00% Decrease
d;
Increase 63.00%
d; 1.00%

Bad; 59.00%
No. of Cashless Transactions per month during demonetization No. of Cashless Transactions per month during demonetization Now

5 to 10 ; 5 to 10; 5.00%
2.00%
1 to 5; 21.00%
1 to 5; More than
30.00% 10; 1.00%

Not a
single;
67.00%
Not a single ;
74.00%
 Means of Cashless Transaction According to you which would have been main objective of demonetization?

80%

70%

60%

50%
Others; 24.00%
40%
71%

30%
Paytm; 7.00%
20%

10% 14%
DebitCard; 6%
5% 4%
69.00%
0%
 Implementation of Demonetization Do you know how much currency notes are return to RBI in Demonetization?

Very Bad; 15.00% Very Good; 2.00%

Good; 19.00%

Don't 99% Notes;

Know; 37.00%
43.00%

80% Notes; 90% Notes;

8.00% 12.00%
Bad; 64.00%
 Who was severely affected by demonetization?

Rich with black money;

26.00%

Poor; 53.00%

Rich ; 3.00%

Middle income group; 18.00%

 Perception on effect of demonetization on India’s progress

Then NOW

Very Good;
Very Bad; 6.00% 11.00% Very Bad;
Very Good;
4.00%7.00%
Bad; 21.00%

Bad; 40.00%

Good; 49.00%

Good; 62.00%
 FINDINGS
• Finally public opinion about demonetization was asked. 12%
respondents told that demonetization was very good decision,
17% think that it was very bad decision and unnecessary. 16%
respondents think that it will be too early to be judgmental on
demonetization decision while majority 55% people expressed
that objectives of demonetization were very good but
implementation was bad.
• Rural economy depends on Cash and cooperative banks, debit
or credit cards, net banking and online transactions which are
popular in Urban India are non-existent in the rural part.
• So demonetization created havoc for the agricultural and
cottage industries.
 CONCLUSION
• Every honest Indian wants to curb black money. But it is not
possible to achieve this goal by single step of demonetization.
• Because most of the black money is invested in the form of
land, constructions or gold or kept abroad like Swiss bank.
• Out of all black money only 4% of the total amount of black
money is in cash on which taxes are not being paid.
• Not all black money is in cash, and not all cash is black
money.
• Those who held large quantities of black money seem to have
found creative ways to launder it, rather than destroying it to
avoid attracting the taxman’s attention, as the government
expected.