What are the cons of demonetisation?

The biggest disadvantage of demonetisation has been the chaos and frenzy it created among common people initially. Everyone was rushing to get rid of demonetised notes while inadequate supply of new notes affected the day to day budgets of citizens.

What are the advantages of note ban?

With the present demonetization move put properly in place, the banking system will improve in a considerable manner. The economy will slowly start moving towards a completely cashless direction. Moving towards a cashless economy also implies better access to credit and revamping of financial operations.

What is meant by demonetisation?

Demonetization is the act of stripping a currency unit of its status as legal tender. It occurs whenever there is a change in national currency. The current form or forms of money is pulled from circulation and retired, often to be replaced with new notes or coins.

What do you mean by demonetisation explain any two benefits of demonetisation?

Merits Of Demonetisation: The Demonetisation plan will help India to convert into corruption-free. Those entertaining in accepting bribes will cease from corrupt methods as it will be difficult for them to retain their illegal money. This step will support the government to trace illegal money.

What are the pros and cons of demonetization?

Let’s look at the pros and cons of demonetization. 1. Reduce inflation: Demonetization led to reduced prices of goods. It also contributed to the decrease in inflation as people don’t have money to waste on unnecessary things. The low demand made goods cheaper.

What is the impact of demonetization on the interest rates?

Interest rate at the time of demonetization fall very low and bank have to cut their interest rates competitively low, so people can easily get a loan without having any issue. Government also emphasis bank to drop their interest rate so that common people can get loan and money flow in the market.

How will curbing black money demonetization help in recovering black money?

Curbing Black Money Demonetization has made it mandatory for every person in India to deposit their old currency in the banks and exchange them for new currency. This will make the cash hoarders to deposit their money in the account and make it accountable. In this manner, black money will be retrieved to a certain extent.

What is the impact of Demonetisation on the formal sector?

The government has recovered due taxes from culprits in short run by this move. As the informal sector shrinks due to demonetisation, the formal organised sector is likely to gain market share. The formal sector accounts for 60 percent of India’s GDP today and it is likely to increase from 60 to 80\%.