In the later hours on 8th November 2016 the Government of India announced a drastic economic reform. It was demonetization of high denomination currencies such as Rs.1000 and Rs.500. By the end of the Financial Year 2015-16, in value terms high denomination notes of Rs.1000 and Rs.500 together accounted for Rs.14.18 trillion or 86.4% of the total value of notes in circulation. The unexpected announcement about demonetization from the part of Government of India harmfully affects many sectors mostly depending day-to-day cash payments. Retailers constitute an important part of such sectors that has experienced the currency famine triggered by demonetization was the financial system prepared to meet the immediate impact of demonetisation, what extend of digitisation India had accomplished. The present study tried to analyse the problems faced by the retailers due to demonetization of Indian currency. It also tried to examine the perception of retailers on the anticipated benefits of demonetization. Demonetization creates welfare losses to the retail sectors of the society who gets income based on their daily sales and those who don’t have the digital transaction culture. Overall economic activities will be dampened in the short term. But the immeasurable benefits of having more transparency and decrease in the volume of black money activities can be pointed as long term benefits.
