Understanding the Impact of Demonetization on Bank Account Holders from Low Income Households

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This study attempts to contribute to the ongoing debate of the short-term and long-term effects of the Indian government's policy of demonetization on low-income households who, although being formally financially included, are most prone to adverse effects of demonetization policy owing to their socio-economic, demographic and occupational profiles. The objective of this study is to ascertain the trends and patterns of financial and economic behavior post-demonetization, as well as understand the difference in adoption and usage of bank accounts, credit and savings patterns, expenditure patterns and adoption and usage of digital financial services.

The study was conducted in peri-urban areas of four states (Maharashtra, Meghalaya, Tamil Nadu, Uttar Pradesh) across three rounds of surveys between April 2017 and February 2018, conducted among low-income households with an annual household income of less than or equal to INR 150,000 (approx. $2,300).

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