How is Demonetization Affecting Women?

Introduction

The sudden demonetization of high-value Indian currency notes in 2016 brought about significant shifts in the nation's financial ecosystem. While demonetization aimed to curb illegal activities such as corruption, black money, and tax evasion, its implementation had unintended consequences, particularly for women. This article explores the specific challenges faced by women in light of demonetization, drawing from the experiences shared by individuals and community leaders.

Challenges Faced by Women Post-Demonetization

Women often bear the brunt of financial management in households, a reality reinforced by their proficiency in small-scale and informal transactions. However, demonetization exposed several vulnerabilities that highlight the need for a gender-sensitive approach to economic policy.

Preferance for Cash Transactions

Women have a natural inclination towards cash transactions, as it allows for easy barter and negotiation. This preference is deeply rooted in local markets and small businesses where individuals can haggle for better prices. However, the sudden shift towards formal financial mechanisms complicated their day-to-day financial dealings. Small shopkeepers and vendors who predominantly accept cash are now struggling to manage their transactions, leading to a significant burden on women who frequently visit these establishments.

Lack of Awareness and Digital Literacy

Many women lack basic financial literacy and awareness about demonetization. Without a clear understanding of the changes, they are often at a loss regarding what steps to take and by what deadlines. This lack of knowledge forces them to rely on family members or friends to guide them through the process, creating a dependency that can be both burdensome and empowering. Additionally, women who do have bank accounts often struggle with the technical aspects of managing their accounts, from withdrawal to deposit.

Operational Challenges with Bank Accounts

Despite increasing efforts to promote digital banking, the transition to online and mobile banking poses significant challenges for women. Those who have accounts often find it difficult to operate their transactions, especially when it comes to using an ATM card. The need for a financial intermediary can limit women's autonomy, as they are often dependent on a male family member or another trusted individual to perform necessary banking tasks. This dependency can exacerbate existing social inequalities and financial challenges.

Household Financial Management

Women are often responsible for managing household finances, including rent, school fees, groceries, and other essential expenses. The sudden restriction on cash transactions has made it difficult for them to manage these payments and transactions. For instance, someone who was managing all household activities with cash now has to wait in long lines at ATMs and bank branches to obtain new notes, causing significant inconvenience and stress.

Saving and Storing Cash

The notion of saving cash in a secure location, such as a metal box or safe, is deeply ingrained in many households. However, demonetization has forced women to confront the need to deposit large sums of cash in banks, a process that can be disorienting and daunting. Many women have never stepped into a bank or have no prior experience with formal financial systems, making the transition even harder. This difficulty in transitioning can lead to financial distress and vulnerability.

Trouble with Change

Even when women are able to withdraw new notes, they often struggle to obtain smaller change. This issue is particularly acute when dealing with Rs. 2000 notes, which can be hard to break down into smaller denominations. Women who manage the household cash now find themselves in a bind, as they cannot easily obtain smaller denominations for daily transactions without significant inconvenience.

Impact on Marriages and Gifts

Women often play a crucial role in organizing wedding ceremonies and preparing gifts for events. Demonetization has disrupted this traditional practice, making it more difficult to budget for large sums of cash required for these events. In many cases, families have to adapt their celebrations and gift-giving practices to account for the new financial realities.

Conclusion

The demonetization policy introduced significant changes to India's financial landscape, but the impact was not uniformly felt across all segments of society. Women, who have traditionally managed household finances, have faced substantial challenges in adapting to the new cashless economy. Addressing these issues requires a comprehensive strategy that includes increased financial literacy, support for women in managing formal financial systems, and policies that are gender-sensitive. By doing so, we can help ensure that the benefits of demonetization are shared equitably, leaving no one behind.

Comment Section

Have you experienced any of these challenges or do you have additional insights to share? Please comment below.