On November 8, 2016, Prime Minister Narendra Modi had announced scrapping of Rs 500 and Rs 1,000 notes.
New Delhi: Demonetisation a year ago has helped in flushing out black money, eliminating fake notes and reducing cash in circulation, the finance ministry said on Monday.
The total currency in circulation has come down to Rs 14.75 lakh crore as of August 4, 2017, from Rs 17.77 lakh crore, said the finance ministry in a tweet.
"Only 83 per cent is the effective currency in circulation today with remonetisation," the ministry said.
Prime Minister Narendra Modi in a surprise move had announced withdrawal of legal tender status of old Rs 500 and Rs 1,000 notes with effect from November 9, 2016.
Detailing other benefits of demonetisation for the economy, the ministry said it has dealt a big blow to finances of terrorism and Left-wing extremism.
Besides, it has helped in expanding tax base, converting non-formal economy into a formal one and making money accountable. It has provided a big boost to digitisation of payments, making India a less-cash economy.
During September, Rs 1.24 lakh crore worth of transactions were done through the digital mode. The number of transactions was 87.7 crore.
The ruling BJP has decided to celebrate first anniversary of demonetisation on November 8. This will see Union ministers and BJP office-bearers across the country build public opinion in favour of the government's decision.
However, the Opposition has decided to celebrate the day as as a "black day".