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Small curency domination

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Post demonetisation, there has been an improvement in digital payment transactions in India. With the increase in digital payments, one would naturally expect a reduction in the usage of cash. Needless to say, cash involves significant cost to the economy. Therefore, people should be encouraged to migrate to digital payment modes to reduce cost to the economy and also to minimise issues involved in cash transactions. However, along with the growth in digital payments, currency in circulation is also going up and, as per the RBI Bulletin of September , it has reached Rs As the economy grows, currency in circulation also grows.

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Largest and Smallest Banknote Denominations – Banknote World

The U. The strength of the U. The term "U. It was initially traded as a coin worth its weight in silver or gold and then exchanged as a paper note redeemable in gold.
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Denomination (currency)

The denomination effect is a form of cognitive bias relating to currency , suggesting people may be less likely to spend larger currency denominations than their equivalent value in smaller denominations. Raghubir and Srivastava conducted three studies in their research on the denomination effect; their findings suggested people may be more likely to spend money represented by smaller denominations and that consumers may prefer to receive money in a large denomination when there is a need to control spending. The denomination effect can occur when large denominations are perceived as less exchangeable than smaller denominations. The effect's influence on spending decisions has implications throughout various sectors in society, including consumer welfare , monetary policy and the finance industry.
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Denomination is a proper description of a currency amount, usually for coins or banknotes. Denominations may also be used with other means of payment such as gift cards. For example, five euros is the denomination of a five-euro note. In a currency, there is usually a main unit base and a subunit that is a fraction of the main unit.
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