By Admin 
SBI Research Report Currency Circulation: The trend of digital payments is increasing rapidly in the country, but the use of cash is also not lagging behind. According to the latest report of SBI Research, the total value of currency in circulation (CiC) i.e. notes in circulation in the market has reached a record level of about Rs 40 lakh crore.
The special thing is that this increase has been recorded at a time when digital payments are becoming increasingly popular. People are adopting online payment to make transactions. SBI Research has presented its latest report behind this increase in the use of cash. In which information about its main reasons has been given. Let us know about this…
1. Increase in cash usage after GST notice
SBI Research report has revealed that the attitude of businessmen has shifted from digital payments to cash. There are reasons behind this like GST notice. According to the report, in July 2025, GST notices were sent to about 18,000 small traders in Karnataka on the basis of UPI transactions.
After this, the inclination of many traders was moving away from digital payments towards cash transactions. The data showed that cash withdrawal increased in that district after the GST notice. This figure increased by Rs 37 crore on an average every month. That means cash flow increased due to decrease in accepting digital payments.
2. Impact of reduction in interest rates and rural consumption
Not only digital transactions but other economic reasons are also behind the increasing demand for cash. In the report of SBI Research, it has been explained through the money demand model the reasons why there is a need for cash.
According to the report, in general the increasing use of UPI should reduce the demand for cash, but the decline in interest rates and increasing consumption in rural areas have balanced this trend. That is, despite the increase in digital payments, the need for cash transactions has not been completely eliminated.
3. Smaller notes are more prevalent
According to the report, the share of Rs 100, 200 and 500 notes is increasing in the country. By March 2025, the share of Rs 500 notes will increase to 86 percent. RBI has also instructed banks to make more notes of Rs 100 and Rs 200 available in ATMs.
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