70 per cent businesses in Mumbai, Pune say note ban hit them hard

Mumbai: The demonetisation drive has impacted nearly 70 per cent of businessmen in the country's financial capital of Mumbai and the manufacturing hub of Pune along with nearby areas, says a report. Sectors such as construction and the informal roadside vendors are the worst hit by note-ban, an SBI research said in a report today.

The findings are based on a survey conducted in Mumbai and Pune among different formal and informal business groups to ascertain the effects of demonetisation on their daily business and whether the move has resulted in increase in digital mode of payments. The survey was conducted between December 30 and January 3.

"The survey reveals that as much as 69 per cent of the respondents have been impacted. But, even then there is an overwhelming support for the move with 63 per cent of the sample supporting it," the report said.

A total of 175 responses were recorded and analysed of which 40 per cent respondents were from premier business locations of Mumbai and the remaining 60 per cent were from Pune and nearby areas.

The respondents said the lack of supply of lower denomination notes resulted in more chaos. The prevalence of digital mode of payments in chemist shops and even in automobile stores has possibly resulted in only marginal impact on their sales, says the survey.

It said the construction sector and the informal roadside vendors seem to be the most hit, with 55 per cent and 71 per cent respondents saying their business came down by over 50 per cent.

Within the textile sector, shopkeepers dealing with retail segment have been more impacted than those in the wholesale segment. Moreover, the wedding season has been disappointing with sales dipping significantly.

"The gems and jewellery sector has also been hit with declining sales," the report said.