Prime Minister of India suddenly demonetised high denomination bank-currency notes, Rs 500 and Rs 1000, to root-out corruption, black-money and fake currencies from the country. But there are differences of opinion, however, the people are facing hardships at present.How we link between high denomination bank-currency with corruption? Please share your thoughts.
Sir, There are two points that immediately come to my mind on high denomination notes & corruption:
First, they are easier to store as they occupy less space and hence safer.
Second, the transactions can be quick and with lower visibility if the packet or bundle are small.
So basically large denomination notes are a convenient store of liquid wealth for corrupt.
Large notes makes transfer of large sums of money possible, but discontinuing them also brings untold hadships in that people not involved in corruption would now need large sacks to carry money for transactions that a small purse would have been sufficient for in the first place. In my opinion a cashless policy ensuring that government and her agencies only use e-payement to ensure that all monies paid in or out have an electronic trail' would solve the problems of corruption in the short-term, while prosecuting corrupt officials and enforcing steep penalties for those involved in corruption would tackle the problem on the longterm
Cashless policy can help to curb corruption, but the political will to do so is another thing.
Thanks to all for sharing their thoughts, higher denomination notes means smoothening more corruption-transactions. The cashless transactions may reduce the corruption-transactions.
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