Currency circulation increasing

RBI - Cash in circulation stands Rs. 38.1 lakh crore as on May 2, 2025

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Despite being leader in digital transactions, cash in circulation is increasing because of the growth in the economy and also because many low-value transactions are done in cash to save on GST.

The total currency in circulation stands at Rs 38.1 lakh crore as on May 2,2025 which is roughly 11.5% of India's GDP. The RBI data shows a 2.4% year-to-date increase in currency in circulation as of May 2, 2025, compared to 1.7% in the same period last year.

Currency usage has remained relatively strong despite the absence of a busy election calendar during which cash usage typically climbs. Cash usage suggests currency notes are still a major driver of consumption expenditure. This growth is influenced by increased demand and the need for good quality notes in circulation, according to the Reserve Bank of India (RBI).

This growth is linked to robust rural demand and positive farmgate prices for agricultural commodities. Cash currency in circulation has more than doubled over the last eight years. As per Reserve Bank of India (RBI) data, since the demonetization of Rs 1000 and Rs 500 notes in 2016, the currency in circulation has increased substantially in India. Demonetisation in November 2016, was undertaken to weed out black money and nudge people to change their method of payment from cash to digital. According to reports digital transactions will increase from 159 billion in 2023-24 to 481 billion by 2028-29 to mark a threefold growth.