Is Demonetisation a Bridge for Digital Financial Inclusion?

Abstract

The purpose of this study is to survey the effect of demonetisation on digital financial inclusion in India and also analyse the attitude and perception of villagers towards digital financial services. The survey is carried out by taking both primary and secondary data. The primary data we have collected by asking questionnaire to the lower income villagers having bank accounts from Basundhara coal mines area of Sundergarh district, Odisha and secondary data from Economic Outlook of CMIE Prowess database. A total of 127 respondents have answered 12 statements in five point likert scale. The scale is designed to judge the degree of agreement with the statements which are based on demonetisation impact on digital financial inclusion. The descriptive statistics and paired t-test are used to analyse the data. The findings suggest that the demonetisation has positively affected the digital financial services provided by the bank. It also found that the villagers are perceived that the use of digital financial services is risky. To the authors’ knowledge this paper is the first attempt to document for examining the impact of demonetisation on digital financial inclusion in India by considering both primary and secondary data.