The Effects of Demonetization on Small and Medium-Sized Enterprises in the USA in the Cashless Economy

Abstract

The primary goal of this research is to examine the impact on the nation's micro, small, and medium-sized businesses. The idea of a monetary policy that doesn't involve cash and the demonetization of high-denomination currencies makes the government very happy. The transition from a cash-based economy to one that depends more and more on electronic payment systems is one of the most environmentally responsible and sustainable corporate practises of the future. Transactions in a cashless economy are done without the need to send actual cash. Payments are made through this process using either a debit card or a credit card. It's a sort of economy where exchanges aren't always described as financial ones. Cashless payments, as opposed to conventional cash transactions, discourage robbery and other crimes using cash. When using alternative forms of payment, people typically carry less actual currency when making purchases. The incentive for burglars to commit crimes involving cash is thus removed. By boosting revenue, increasing operational effectiveness, and reducing operating expenses, vendors will gain from the convenience of transactions across several payment channels. Since the nation recently decided to demonetize its money, everyone will be required to do all of their financial transactions online. The rapid implementation of demonetization harmed the MSME sector, which prefers to operate in a traditional manner. The rapid implementation of demonetization harmed the MSME sector, which prefers to operate in a traditional manner. This business will require strict regulatory scrutiny to succeed in the cashless era. Without MSMEs, economic developments would hurt the economy. The increased use of digital infrastructure by retailers and customers has led to an electronic monetary philosophy. The study's findings show how small and medium-sized enterprises in the United States might be affected by a cashless world. According to the report, SMBs may face challenges in a cashless economy as well as alternate alternatives. Utilizing secondary information and basic statistical techniques, the findings of this investigation were examined.