Note ban anniversary: Mumbaikars say initial hardships make way for long-term gains

Mumbai: On the first anniversary of demonetisation, Mumbaikars have mixed feelings about the measure with a major section saying it will bring long-term gains though people faced hardships initially.

However, some residents of the financial capital were critical of note ban announced on November 8, 2016, following which then high value currency of Rs 1,000 and Rs 500 ceased to exist as legal tenders.

The residents also maintained that the initial enthusiasm for digital mode of payments has largely died down and cash transactions are once again gaining currency.

Narottam Mishra, who runs a chartered accountancy firm in Kannamvar Nagar, suburban Vikhroli, said demonetisation is sure to bring long-term benefits.

"It's true that people faced hardships in the initial days of (demonetisation). Several people lost their jobs and industries faced financial problems. Demonetisation brought short-term pain for long-term gains. Its positive effects would be visible in the longer run as it has helped the Government know the cash flow in the system and also increased tax compliance," Mishra said, "The only wrong thing, according to me, was to introduce the Rs 2,000 note."

Shailendra Yadav, who works in a garments factory in suburban Andheri, said cashless transactions, which rose after the note-ban announcement, have lost momentum. "People had thought India would become a cashless economy. But unfortunately, nothing has changed and post-remonetisation use of cash has increased. Shopkeepers no longer insist on payments through Paytm or any digital mode. They prefer taking cash," Yadav said.

Pramod Harlalka, owner of a small packing unit at Kalbadevi, South Mumbai, hailed the note-ban as a "bold" measure and said in the last one year the country has moved towards becoming "corruption free". "The common man supported note bandi. Only those who had huge cash with them cried foul. We must give some more time to the Government to see the long-term effects of this (demonetisation)."

A banker employed with a cooperative bank in Ghatkopar said, "Soon after demonetisation, digital payments gateways (like mobile wallets, credit/debit cards, Unified Payments Interface or UPI) gained in popularity because ATMs had dried up and enough cash was not available in the market. But after the new notes were circulated, the cashless drive died down and cash use almost reached pre-demonetisation levels. Therefore, I do not see any substantial change in the overall pattern of consumer behaviour," he said.

RTI activist Manoranjan Roy, who has filed a PIL in the Bombay High Court against the RBI alleging discrepancy in printing notes, criticised the note-ban drive and called it "unplanned". "The ill-effects of unplanned demonetisation is going to hit the common man, industries and the economy for two more years," he said.

O P Sharma, a Bhandup resident who retired from the Railways, said, "Those who can't see the positive side (of demonetisation) should at least wait for sometime. (Post-note-ban) Over three lakh bogus companies have downed shutters. Corruption and terrorism have taken a hit. Tax compliance has increased and the government now has more money to fund infrastructural projects," said Sharma.

Vinod Harlalka, who runs a sub-broking firm in South Mumbai, said the capital markets have benefited from the move as key indices have posted gains in the last one year. "In one year of demonetisation, the Nifty is up 21 percent, the Sensex 21 percent, the Nifty Bank 30 percent, the mid-cap index 27 percent and the small-cap index is up 37 percent."