According to a report by the State Bank of India (SBI), the gap between per capita currency in circulation and ATM withdrawals has expanded significantly, reaching ₹9,127 in FY26, compared to ₹1,804 in FY24. This increase signals a rise in precautionary cash holding, driven by global uncertainties and behavioral changes from past disruptions. Despite the rise in cash holdings, the cash-to-GDP ratio declined from 14.4% in FY21 to 12.1% in FY26, indicating that currency growth is in line with overall economic expansion. Currency in circulation reached an all-time high of ₹41.6 trillion, marking an 11.9% year-on-year increase and an incremental rise of ₹4.4 trillion, the highest since the demonetisation period.

Digital transactions are also on the rise, with UPI transactions increasing 20.6% in value to ₹314 trillion and 30% in volume to 241.6 billion. The report highlights that while per capita currency holding has increased, it has done so at a slightly slower pace than income growth, reflecting the growing role of digital payments. Per capita GDP rose from ₹71,609 in FY12 to ₹2.5 trillion in FY26, with per capita currency in circulation increasing from ₹8,762 to ₹29,324. The report also notes that cash remains essential for emergencies and informal transactions, with ₹500 notes accounting for 86% of the total currency value. Additionally, central bank digital currency (CBDC) remains in its early stages, with a circulation of ₹1,016 crore, or about 0.02% of total currency in circulation.