6 Years After Demonetisation: Cash Not King, But Still Rules in Real Estate, Household, Food Delivery, Says Survey

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posted on 2 years ago — updated on 1 second ago

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Although digital transactions continue to rise in India, a survey by LocalCircles shows 44% of 32,000 respondents, who bought property in the last seven years, said cash was part of the transaction. It also said most people are using cash for eating out and food deliveries, to buy groceries, pay for house repairs

Today marks the sixth year after demonetisation was implemented by the Narendra Modi government to curb black money and increase digital transactions in the country. Although it is still unclear whether the move completely delivered the goal, there are reports and evidence that people are still paying or accepting black money in the real estate transactions.

According to a survey conducted by LocalCircles, 44% of 32,000 respondents in 342 districts, who bought property in the last seven years, said cash was part of the transaction. But the situation looked better compared to last year when 70% of respondents admitted to paying cash as part of the transaction to buy a property, according to LocalCircles November 2021 survey.

Paying cash to buy a property has seen negligible reforms as property owners want to avoid paying full tax involved in the deal. Therefore, bribery still is rampant in the area.

Other departments where cash use was reported to be high were home repairs, beauty services and salaries of house staff. Nearly 20% respondents said they used cash to pay salary to their help, 3% spent on travel expenses while 10% people expended on home repairs in the last 12 months.

Besides this, the survey pointed out that people were using cash to buy groceries, for eating out and food deliveries. Out of 10,224 respondents, 62% said they used cash for eating out and food deliveries. The response revealed that even today people find it more convenient to use cash to buy fruits, vegetables and other grocery items.

According to the National Payments Corporation of India, 250 million Indians use Unified Payments Interface (UPI) for making transactions. The value of UPI transactions in August 2022 touched Rs 10.73 lakh crore.

The Reserve Bank of India’s report in September showed over Rs 31 lakh crore worth of currency notes are in circulation even as digital payments are rising. The RBI survey had suggested that a large section of the society is still using cash despite increase in digital payments.

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