On November 8, India completes ten years since the announcement that abruptly stripped the existing Rs 500 and Rs 1,000 banknotes of their legal-tender status. Presented as a decisive assault on black money, corruption, counterfeit currency and terrorist financing, demonetisation required millions of citizens to surrender their cash and endure restrictions on access to their own savings.A decade later, the measure must be judged against its promises and its consequences for ordinary people. The central questions remain: What did it achieve? Who bore the cost? And has the government provided a convincing account of why such widespread suffering was necessary?From a people-centred perspective, demonetisation exposes a profound failure of economic policy: the livelihoods of millions were disrupted without establishing that the same objectives could not have been pursued through less damaging means.The fundamental mistake: Confusing cash with black wealthDemonetisation rested on an inadequate understanding of the black economy. Unaccounted income is generated through activities and transactions; accumulated illicit wealth can be held in property, gold, financial assets, business structures and overseas arrangements. Currency is only one possible form.Replacing banknotes cannot, by itself, dismantle the mechanisms that generate tax evasion, corruption and illicit accumulation. Without sustained investigation of ownership, transactions and financial networks, a currency exchange exercise leaves those mechanisms substantially intact.The decisive evidence against expectations of a large extinguishment of unaccounted cash came from the Reserve Bank of India (RBI). Of the approximately Rs 15.42 lakh crore in specified banknotes withdrawn, about Rs 15.31 lakh crore – 99.3% – returned to the banking system. Only around Rs 10,720 crore did not return.This does not mean that every deposited rupee was legitimate. Deposits created information that tax authorities could examine, and depositing money did not automatically discharge any tax liability. Nevertheless, the anticipated disappearance of a substantial stock of illicit cash did not occur.The government must therefore demonstrate the additional tax recovered and the durable reduction in illicit activity attributable specifically to demonetisation, measured against its economic and social costs. The volume of deposits alone cannot establish success.An unequal burden imposed on working peopleThe hardship was distributed according to class.A household with savings, electronic payment facilities and secure employment had greater capacity to manage the disruption. A daily-wage worker without an income cushion could lose the means to buy food. A large enterprise could use banking channels and organised supply networks; a small workshop dependent on cash sales and weekly wage payments faced an immediate threat to survival.For agricultural labourers, street vendors, domestic workers, construction workers, small traders and migrant workers, cash was an essential means of earning and living. Treating dependence on cash as evidence of economic backwardness – or a reason for suspicion – ignored the conditions under which much of India works.Women’s household savings deserve particular attention. Money kept aside for illness, education or emergencies can represent years of sacrifice and a limited sphere of financial autonomy. A policy that suddenly makes such savings difficult to use imposes costs that conventional economic accounts may never record.The class character of the exercise lay in this unequal capacity to absorb the shock. Those with the smallest reserves were asked to bear an exceptionally heavy burden in the name of a campaign against illicit wealth.Economic disruption was realThe economic damage cannot be dismissed as inconvenience.Research by Gabriel Chodorow-Reich, Gita Gopinath, Prachi Mishra and Abhinav Narayanan found that the cash shortage reduced aggregate employment and output measured through night-time lights by at least two percentage points in the quarter of demonetisation, relative to their estimated paths without the shock. The estimated effects dissipated over the following months. These findings concern the immediate disruption; they are not an estimate of a permanent two-percentage-point reduction in annual GDP.That distinction matters. A credible critique should avoid attributing every subsequent slowdown to demonetisation. GST implementation, credit conditions, other domestic developments and, later, the pandemic also affected economic performance.But acknowledging those factors does not erase the initial damage nor does the recovery of an aggregate indicator restore wages already lost, reverse distress borrowing or reopen every enterprise that closed.For workers, a temporary economic shock can have lasting consequences. A missed month’s income may become a debt carried for years.Bank employees carried the operational burdenBank employees became the public face of a decision they had neither designed nor controlled. They had to explain restrictions, handle extraordinary crowds, process surrendered notes and manage the shortage of replacement currency.The distinction between those who made the policy and those required to implement it must remain clear. Public anger at shortages and changing arrangements often fell on frontline staff.The fiscal and operational costs were also substantial. RBI expenditure on printing banknotes rose from approximately Rs 3,421 crore in July–June 2015–16 to Rs 7,965 crore in 2016–17. This was printing expenditure, rather than a complete estimate of the cost of demonetisation. Banks and the wider economy also incurred costs from currency handling, transport, ATM recalibration and displaced normal activity.A serious assessment must recognise the labour that sustained the banking system through this disruption.Ten years later, cash remains indispensableThe subsequent growth of cash undermines the suggestion that a modern economy could rapidly dispense with it.The RBI’s 2025–26 Annual Report places the value of banknotes in circulation at approximately Rs 41.24 lakh crore at end-March 2026, compared with Rs 36.87 lakh crore a year earlier. The Rs 500 denomination accounted for about 85.5% of banknotes by value. These figures concern banknotes, which should be distinguished from broader measures of currency that include coins.Rising nominal cash does not prove that black money has increased. Prices, population, economic activity and precautionary demand all influence currency holdings. Comparisons across years must also consider inflation and the size of the economy.The defensible conclusion is that cash continues to serve important economic and social needs. Its persistence should guide policy towards reliable access, rather than attempts to stigmatise its users.Digital payments: an achievement requiring an honest explanationDigital payments have expanded enormously. That achievement should be acknowledged.National Payments Corporation of India (NPCI)’s published statistics record approximately 24.07 billion UPI transactions worth Rs 29.37 lakh crore in September 2026. UPI’s commercial launch preceded demonetisation, taking place in August 2016.The cash shortage encouraged immediate adoption of electronic payments. However, it does not follow that a decade of digital expansion required the cancellation of most of the country’s currency by value. Banking infrastructure, smartphones, connectivity, convenient payment systems and subsequent changes in behaviour all belong in the explanation.Digital growth and continued cash use can coexist.A progressive approach should expand payment choices while protecting access, privacy and public accountability. Financial inclusion means that people can transact safely and affordably, including when connectivity fails or digital skills are limited. It cannot be reduced to the number of transactions recorded on an app.Counterfeit currency and security: enduring problems need enduring measuresDemonetisation could invalidate existing counterfeit versions of withdrawn notes. It could not prevent counterfeiting of their replacements.According to reporting on RBI’s 2025–26 Annual Report, the banking system detected 2,29,746 counterfeit notes, including 1,41,907 counterfeit Rs 500 notes. These figures exclude seizures by police and other enforcement agencies.Detection figures do not measure the entire stock of counterfeit currency, and changes can reflect detection capacity. They nevertheless demonstrate that counterfeiting survived the currency replacement.Also read: 8 PM, 9 Years On: Remembering the Failed National Improvement Scheme That Was DemonetisationLikewise, the continuation of terrorism or insurgency does not, by itself, measure demonetisation’s precise effect on their financing. It does establish the inadequacy of treating a one-time currency measure as a comprehensive answer to complex security problems.The Rs 2,000 note: A revealing policy reversalThe introduction of a Rs 2,000 note alongside a campaign against high-denomination cash raised an obvious question about consistency.In May 2023, the RBI announced its withdrawal from circulation under the Clean Note Policy. The RBI explained that the denomination had primarily met the immediate currency requirement following the withdrawal of the old notes, and that printing had stopped in 2018–19.The 2023 withdrawal must be distinguished from the 2016 cancellation of legal-tender status. RBI’s withdrawal instructions retained the Rs 2,000 note’s legal-tender status.Even with that distinction, the episode invites scrutiny of the original currency strategy and the costs of successive changes.Legal validity does not establish economic successOn 2 January 2023, the Supreme Court upheld the 2016 decision by a 4:1 majority. Justice B.V. Nagarathna dissented on the legal route adopted, holding that a government-initiated exercise of this nature required legislation rather than the notification procedure used.The judgment settled the legal challenge before the Court. It did not establish that demonetisation fulfilled its economic promises or that its benefits outweighed its burdens.Democratic accountability continues beyond judicial review. Citizens remain entitled to an assessment of outcomes, costs and alternatives.What a people-centred alternative requiresA serious struggle against the black economy must confront the institutions and interests through which illicit income is generated and concealed.That requires stronger investigation of beneficial ownership, benami holdings, shell entities, fraudulent invoicing, illicit financial transfers and opaque political finance. It requires capable tax administration, action against collusion and corruption, and scrutiny that reaches powerful economic interests.Formalisation should bring workers social security, enterprises affordable credit and citizens accessible public services. Registration and digital records have limited value if livelihoods become less secure.A decade after demonetisation, the demand should be for an independent, publicly available assessment of its additional revenue gains, employment effects, costs to banks and consequences for households and small producers.The millions who surrendered their time, wages and peace of mind were promised a decisive blow against illicit wealth. They are entitled to evidence of what their sacrifice achieved.Economic policy must be judged by its contribution to secure livelihoods, equality and public welfare. On that test, demonetisation remains a deeply damaging lesson in terms of the consequences of imposing an economic shock on people with the least capacity to bear it.Devidas Tuljapurkar is the chairman of the Banking Education Training Research Academy (BETRA).