DEMONETISATION

1. action would curtail the shadow economy and crack down on the use of illicit and counterfeit
cash to fund illegal activity and terrorism.
2. created significant disruption throughout the economy, threatening economic output.
3. The BSE SENSEX and NIFTY 50 stock indices fell over 6 percent on the day after the
announcement.
4. poor policy and even poorer execution – Deaths and ATM shortages
5. Effects
a. Human Trafficking - fell but increased later on
b. Radical groups - badly hit Maoist and Naxalites. The surrender rate has reached its
highest. crippled Communist guerrilla groups (Naxalites) financing through money
laundering
c. Reduction of stone pelting
d. Decline in stock markets – short
e. Agriculture - heavily dependent on cash. farmers have insufficient cash to purchase
seeds, fertilisers and pesticides. crash in the prices of crops.
f. E-commerce – decline in COD by 30%
g. Cashless Economy. Boost to Digital India
h. GDP growth rate reduced to 6.1% and then to 5.7%
i. loss of jobs due to demonetisation, particularly in the unorganised and informal
sector and in small enterprises.
6. The usage of credit cards and cash cards has increased over the past years, but it is still far
from optimal.
7. The off-loading of vehicles can sometimes be needed at warehouses located in interior
regions of the country. These are regions in which cashless transactions cannot be expected
all of a sudden
8. Expenses During Transit is done through cash transactions.
9. Opportunity
a. Convenient transactions.
b. Higher levels of transparency.
c. Easier tracking of transactions.
d. Higher questionability of employees.
e. Minimized leakages in payment processes.
10. Affected Supply Chain for short time. But not great impact on it.
 BLOCK CHAIN

1. Technology has changed the ways by which people buy products and services. People require
faster and easier ways to exchange and use units of currency.
2. In ancient civilizations, people primarily relied on metal coins, which was followed by paper
currency. Then came credit cards. Now it is moving towards adopting blockchain technology.
3. distributed, decentralised transaction ledger’. Blockchain is also immutable, resilient and
secure.
4. establish trust between two unrelated parties over a largely unknown network like the internet.
5. peer-to-peer and do not require the presence of an intermediary. All Bitcoin transactions are
recorded on a ledger also called a block chain. The ledger is maintained by a group of
communicating nodes
6. absence of any intervening body between two or more parties conducting a set of transactions.
7. Bitcoin promises flexibility and speed, as it can be exchanged between individuals just like cash or
paper currency. The essential difference between PayPal payment systems and Bitcoin because
of Bitcoin’s reliance on cryptography.
8. The volatility of Bitcoin continues to be a source of worry.
9. The Chinese Central Bank passed an order prohibiting financial institutions from handling any kind
of transaction related to Bitcoin.
10. convertible decentralized virtual currency
11. Opportunities
a. Easier cross-border business
b. Speeding up the process of automation
c. Changing they way businesses operate
12. Threats
a. Organisations are still reluctant to change
b. Banks especially are very risk averse
c. It’s not been done before, so there are no best practices to follow.