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Abstract
The government of India announced demonetisation from the midnight of 8th November 2016 as a tool to crack down the stock of black money, corruption & terrorism activities. With the application of demonetisation, it has driven the country towards a cashless society. Lakhs of the people even in far-flung areas have started using the cashless transactions. This scheme mainly affects the common people, businesses, financial institutions as well as distinct industrial framework of India. The main motive of this scheme is to make India digital economy as well as financial inclusions cashless. For this cause, the new generation should be influenced to educate and help the poor and elderly with digital education and transactions. Rather than this data that the Jammu and Kashmir has a far-reaching banking systems and the essentialness of smaller scale money lies in the way that the proper financial part has not met the monetary needs of the poor segments because of the accompanying reasons; a) Inadequate bank offices in the remote zones b) Inability of the poor to offer acceptable securities against the advances. c) There is a low degree of training and data among the unprivileged area of individuals. d) There is a protest of banks to raid into microfinance.This paper emphasises studying demonetisation & its impact on the microfinance sector of Jammu and Kashmir.