Even as the government went back on its earlier assurance and halted the exchange of old discontinued notes of Rs 500 and Rs 1,000 from Friday, footfalls at the branches of various lenders indicated that the number of those wanting to exchange their old denominations was not getting any lesser. A State Bank of India branch in West Delhi witnessed a large number of people turning up early in the day to exchange old notes, but on being informed by the bank staff about the government’s latest decision either turned away or stayed in the queue depending on whether they held an SBI account.
A similar incident happened at a State Bank of India branch in Kanpur, Uttar Pradesh. “Around 8-10 people came today (Friday) to exchange old notes for the new ones as they didn’t know about the government regulation that has now banned such exchange. The ones who had account with our bank, we told them to get the old notes deposited. We suggested others — who had come for exchange — to go to the banks where they already have accounts and get the old notes deposited there,” a senior branch official at Kanpur told The Indian Express.
At another public-sector bank branch in Darbhanga district of Bihar people turning up to exchange their currency denominations, which have ceased to be legal tenders, were advised against waiting in queues.
“Around 2-4 guys came today to exchange the notes. We told them to deposit the amount in their bank account. We have been anyway telling our customers to not stand in the line for exchange as it is quite long. We have been telling them to stand in the line for deposits. After making the deposit, the customer is advised to come next day to withdraw the money. Many of our customers are doing that,” an executive from the Darbhanga district bank branch said.
The move to ban exchange of older currency notes has also resulted in rise of low-ticket deposits of some banks. “Till yesterday the deposits amounting to Rs 500-Rs 1,000 or Rs 2,000 were not many. But now when people can’t exchange their notes, deposits of small amounts have also started picking up. Earlier we largely saw deposits of big amounts,” said a Central Bank of India official posted in Ahmedabad. “We expected that this would ease the burden of cash demand from people but that has not happened,” the official added.
The official added that against an estimated demand of Rs 20 lakh per day, the branch could withdraw only Rs 10-11 lakh from the bank’s currency chest and a number of people were still going back empty handed. According to a PSU bank official in the Auraiya district of Uttar Pradesh, the cash crunch did not ease even after the curbs on exchange.
“The cash crunch is here. Our area is totally rural, and there are only two public sector banks, including ours in 10 kilometre radius. So, we require significant amount of cash to dispense. However, the amount that is coming from the main branch is irregular. On some days, it is high. On other days, it is just 40-50 per cent of what we have been asking for,” the official said.
According to the bank employee at the Darbhanga branch, the cash van was only able to reach the rural branches once in three to four days. “As soon as the money reaches in these rural branches, the people withdraw all of it within hours. Our bank does not have the infrastructure to send the money to these (rural) branches daily. There is a huge demand there for cash,” he said.