India’s digital payment revolution has produced a remarkable transformation: millions can now transfer money instantly with a phone, often without handling currency at all. Yet the country is not becoming a cashless economy. The more interesting reality is that cash is acquiring a different purpose. The Reserve Bank of India has around 176 billion banknotes in circulation and continues to print billions of new notes every year. This is happening even as Unified Payments Interface transactions approach a billion a day. The contradiction is apparent.

Digital payments are replacing cash primarily as a mechanism for everyday exchange. They are not replacing all the reasons people want to possess money in physical form. For many Indians, cash remains a reserve against uncertainty. A power cut, network failure, cyberattack or malfunctioning payment system can instantly turn a digital balance into something temporarily inaccessible. Cash does not require a smartphone, password, battery or internet connection. Its usefulness therefore increases, rather than disappears, when dependence on digital infrastructure becomes pervasive. There is a broader social dimension. The elderly, poorer households, small traders and........

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