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Debit card-based ATM withdrawals up 235% since demonetisation: Report

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The monthly ATM cash withdrawals using debit cards have jumped over 235 per cent since the Centre announced the demonetisation exercise in November 2016, a new report revealed on Wednesday. As compared to Rs 84,934 crore withdrawn in December 2016, Rs 2.85 trillion were withdrawn in March 2023.


The withdrawals in March are 121.33 per cent and 40.88 per cent higher than the withdrawals values of April 2020 and May 2021, respectively.

The findings in the “India Cash Vibrancy Report 2023” released by CMS Info Systems showed that the cash in circulation (CIC) in the Indian economy dipped sharply after demonetisation but has more than doubled since then.


From Rs 17.78 trillion in October 2016, India’s CIC fell to Rs 9.43 trillion in December 2016. However, at the end of March, the total CIC stood at Rs 33.8 trillion. It is growing every year.

“At Rs 33.80 trillion at the end of March 2023, there is an annual growth of 5.33 per cent in CIC from Rs 32.09 trillion at the end of April 2022. And, on a three-year basis, the absolute CIC growth is 33.98 per cent in comparison to Rs 25.23 trillion at the end of April 2020,” the report said.


Moreover, the CIC to gross domestic product (GDP) ratio was in the range of 10.7 per cent to 14.39 per cent between FY18 and FY23. The ten-year average is 11.8 per cent.

“The report demonstrates the relevance and importance of cash in the Indian economy. It is critical to widen financial inclusion and provide a convenient and low-cost payment system which is accessible to everyone in society. We have seen 10.1 per cent 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.


The report showed that the pan-India ATM cash replenishments carried out by CMS Info Systems witnessed a growth of 16.6 per cent in FY23. Karnataka saw the highest annual average cash replenishment per ATM at Rs 1.73 crore in FY23, which was 18.1 per cent higher than Rs 1.46 crore replenished per ATM during FY22.

Karnataka was followed by Chhattisgarh and Andhra Pradesh.


“It is noteworthy that a significant portion of the population in India is unbanked, with no access to formal banking services. These individuals rely on cash usage every day as their primary means of conducting transactions. Under penetration of financial and digital literacy further leads to security concerns for digital payments despite the convenience offered. The correct balance of cash and digital will lead a booming economy like ours to an upward trajectory, is our belief,” Raghavan added.

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