The indian intelligence agencies are largely responsible for the bank NPA losses, as they openly favor certain business groups, wasting tax payer money and behave as if the increasing the profit of the group is a matter of national interest. Because these intelligence officials, especially CBI was not professional and competent enough to warn the mainly public sector banks about the large business groups, who became wilful defaulters later, though they lead a lavish lifestyle like vijay mallya, the banks were making huge losses.
Now the indian government has to manage the losses of the public sector banks, and demonetization appeared to be the easiest way to make some quick money. The biggest gainers are the public sector banks who have found that their deposits have increased rapidly and can offer a low interest rate to their depositors. After 2009, the intelligence and security agencies were involved in major impersonation/identity theft frauds, especially on professionals, small business owners,stealing their retirement savings without a court order or legally valid reason like the domain investor.
so people lost faith in the banking and financial system, realizing that it was very difficult for an indian citizen to fight the powerful indian intelligence and security agencies who wasted tax payer money to destroy the life, finances and reputation of harmless citizens for personal gain and to increase the profit of specific corporates who bribed these officials. As a result in the last few years, people are realizing that all banking transactions can be closely tracked, so they are preferring to deal in cash which the indian government will find difficult to track.
The government also probably realized this, so to force people to return the money to the bank, they have demonetized indian currency, People will lose faith in the currency for a long time, and the rupee has crashed against the dollar, official rate Rs 68/dollar, actual exchange rate in goa Rs 100 per dollar