India has adopted parliamentary democracy. In our democracy the people are sovereign. Common man is at the center of the overall decision-making process. Taking care of the interests of the common people is an important duty of the government. In India corruption, black money, inefficiency, Centralization of wealth and Centralization of capital are the main obstacles of common man. The common man is trapped in depression due to these problems. As a solution to all this, Prime Minister of India Shri Narendra Modi decided on demonetization on 8 November 2016. He advocated demonetization, predicting that it would lead to overall transparency in the Indian economy, and encouraged the introduction of a cashless economy and E-Banking is preferred. The research paper emphasis on the importance of cashless transactions trend also some of its advantages and disadvantages, to raise the awareness of digital payment system. This research is based on the accessible literature, and the relevant important databases.