Cash remains in demand nearly seven years after New Delhi embarked on the biggest currency swap exercise in Nov 2016, reported Economic Times.
Cash withdrawals from automated teller machines (ATM) more than tripled to ₹2. 84 lakh crore at the end of March 2023, up from November 2016, data from financial logistics provider CMS Infosystems showed.
The pan-India ATM cash replenishments carried out by CMS Info Systems witnessed an annual growth of 16.6 percent in fiscal year 2023.
Currency in circulation (CIC) in India has been on a steady rise. After touching 8. 7 percent in 2016, India’s CIC to GDP ratio has averaged close to 12. 4 percent, which is higher than the 10-year average of 11. 8 percent.
“We have seen 10. 1% growth in monthly average cash replenishment at ATMs and a strong 1. 3X increase in average cash collection per point with e-commerce companies in FY23,” said Anush Raghavan, president, cash management services, CMS Info Systems.
Maharashtra, Gujarat, Tamil Nadu, Karnataka, and Uttar Pradesh together accounted for 43. 1% of the total ATM cash replenished by CMS Info Systems across the country.
Incidentally, these are the top 5 states with maximum gross state domestic product (GSDP) in fiscal year 2022, according to CMS Infosystems.
Karnataka saw the highest annual average cash replenishment per ATM at ₹1. 73 crore in FY23, which was 18. 1% higher than ₹1. 46 crore cash replenished per ATM during FY2022.
India witnessed the maximum cash usage and demand during the festive and wedding seasons between October to December in financial year 2022, and during October, December and March of financial year 2023.
At $421 billion in 2021, India saw the third-highest annual growth of 7.9% in CIC, while the UK (11.8%) and China (10.2%), respectively, saw the highest and second-highest annual growths over 2020.