Currency is the back bone of any economy. Currency is a legal tender of exchanging goods and services. In old times, barter system is very popular when humans try to circulate any goods or products.
First, In barter system everyone circulate their wheat, rice, etc to other directly. One KG of wheat is exchange by one KG of rice that’s very simple. This system takes time and and not scalable in large proportion.
Second, we mine gold from land and use it for transfer because gold is precious metal at that time and now also. But one problem with gold is that we need to mine gold and that is very complicated. Gold is limited resource and no central regulation for it.
Third, Government of any economy use fiat money in exchange of gold. Print fiat money corresponding to gold reserves. But it is very difficult for any country in bad times, because we print fiat money directly proportional to gold reserves of any country.
After first world war, when country need more money to survive then government can’t print money because they short in gold. To handle this problem government remove gold standards and print money whenever they want.
Forth, Paper money is now in circulation. Paper is the best transfering medium for any services because it can be control by government. But when any government print unlimited money then it’s value decreases and inflation rises.
Now digital paper money and physical paper money we use. India is the fastest and largest digital money user base with the help of UPI system. After demonetization happens in india in 2016, india become shift towards digital payment methods.
Demonetization happens because more notes in circulation in indian economy and more corruption due to this reasons demonetization. But still we use currency notes of 500 and 2000 in circulation.
Most Used Currency Notes in India by Values
According to groww.in instagram handle 3,477,807 means 34 Lakh 77 Thousand crore cash money is in circulation as in 2024.
| Note | Values |
|---|---|
| 2000 | 8,202 Cr |
| 500 | 30,08,847 Cr |
| 200 | 1,54,215 Cr |
| 100 | 2,05,656 Cr |
| 50 | 44,892 Cr |
| 10 | 24,951 Cr |
| 2,5 | 4,249 Cr |
Notes of 500 rupees is the highest in circulation as of march, 2024 in the country. While 2,000 rupees are stood at 8,202 Cr.
Why Government Can’t Print 10,000 Note ?
Government can print 10,000 rupees money but it leads to less liquidity in the society. Imagine you want to buy 10 rupees of ice cream from the shop, but you only have 10K note then what should you do ? is it possible ease of circulation ? answer is no. That’s why government can’t print bigger number of notes.
Why Government Can’t Print Unlimited Money ?
When government print more money to solve poverty problem in the country that’s only lead to increase inflation and de value of notes.
Most Used Currency in The World ?
Us Dollar is the widely used medium of exchange while any country want to buy and sell products. US Dollar is used because they got freedom first and uses their resources efficient and become top economy in terms of GDP.
But Indian Rupees can disrupt US Dollar in coming years because of PM Modi’s good connection with every country.
