Survey on the Usage of Coins and Banknotes
FinTech BizNews Service
Mumbai, May 30, 2024: The RBI survey on the usage of coins and banknotes covered a total of 22,725 respondents, comprising 11,474 consumers and 11,251 merchants (viz., small manufacturers, retail traders and service providers) spread across 20 states/union territories. Around 63 per cent of the total respondents were from rural and semi-urban areas, 19 per cent from urban areas and 18 per cent from metropolitan centres, according to the RBI’s ANNUAL REPORT 2023-24, released today on 30 May, 2024.
Major Findings
Consumers
According to the survey, 56.7 per cent of the consumer respondents required coins predominantly for tendering change while shopping, travelling and for making donations. The need for Rs5 coins was the highest, followed by Rs2 and Rs10. A majority of the respondents reported that they had not faced any shortage of coins in the last one year. With regard to banknotes, more than 80 per cent of the consumer respondents required banknotes for shopping, travelling, making utility/fee payments and for emergencies.
More than 70 per cent of the respondents cited better availability of banknotes of Rs100 and above vis-à-vis banknotes of Rs50 and below. Around 80 per cent of the respondents did not encounter scarcity of banknotes in the last one year. With increasing ticket size of transactions, the preference among consumer respondents has shifted towards digital payments. Compared to the all-India average, the penetration of digital payment usage was less in rural areas due to lower familiarity with digital payment modes, besides safety concerns. This disparity was more pronounced among the people of age 60 years and above.
Merchants
Around two-thirds of the merchant respondents utilised coins for business transactions, travelling and donations, with its usage being higher among retail traders followed by service providers. The requirement for Rs5 coins was the highest followed by Rs2 coins and Rs10 coins. Around 25 per cent of the respondents cited shortage of coins in the last one year with 41 per cent of those deeming it as a seasonal factor. As regards banknotes, about 90 per cent of the merchant respondents utilised them for business transactions, travelling and exigencies. Easy availability of banknotes particularly of Rs100 and above was noted by the respondents. Above 80 per cent of the respondents reported that they did not face scarcity of banknotes in last one year. There was a preference for digital payments with increase in transaction value. However, non-familiarity with digital payment modes and safety concerns were reported as impediments in the usage of digital payment options, especially in rural and semi-urban areas. In sum, the survey indicated that, while cash remained prevalent, the digital modes of payment were gaining traction among the public
