Cash infusion not enough

VISAKHAPATNAM: Banking services are likely to be hit badly and even collapse on Thursday, the first day of December and pay day for salaried employees. Adding to the chaos already existing in banks after the NDA government demonetised Rs 1000 and Rs 500 notes on November 8, thousands of employees are expected to invade banks on Thursday in the hope of withdrawing a portion of the salaries that they expect to be deposited in their bank accounts.
As of Wednesday evening, Reserve Bank of India (RBI) has been able to provide only Rs 160 crore, an amount that is woefully insufficient to cater to the salaries of employees working in private companies as well as government and public sector enterprises in the city.According to sources, the salaries of state government employees alone in Vizag district works up to around Rs 120 crore per month. And if the salaries of central govenrment, private sector staff and defence personnel are taken into consideration, the amount provided by RBI will fall very short.
As per the sources, while majority of the currency notes that have been received are of the Rs 2,000 denomination, around Rs 15 crore has arrived in the form of Rs 500 notes to the banks. Banking sources said the Rs 160 crore would be distributed among 30 banks on Thursday according to the number of branches each has.
At the same time, the Rs 15 crore worth Rs 500 notes is to be distributed for loading ATMs and bank branches on Thursday morning for withdrawal by customers that has been witnessed since the demonetisation move three weeks ago. Some banks, like the Andhra Bank main branch at Seethammadhara started dispensing Rs 500 notes to customers on Wednesday.
Confirming to TOI, district lead bank manager D Sarat Babu said, “We have received Rs 160 crore and it will be distributed to 30 banks. We expect that with this amount, we will be able to handle the demand from customers for the next two to three days.”
However, banks without currency chests complained that they are receiving only a meagre amount in the form of Rs 2,000 denominations and that they are not being provided lower denominations despite instructions from RBI.
Speaking on condition of anonymity, the manager of a nationalised bank that does not have currency chest said, “The condition of banks without currency chest is very bad because our requests for money is not being addressed by the major banks.” The banks without currency chest in the city include Karur Vysya Bank, Karnataka Bank, United Bank of India, IndusInd Bank, Dhanalakshmi Bank, Bandhan Bank and South Indian Bank. He said, “Today (Wednesday), we had yet again requested Andhra Bank to provide at least Rs 1 lakh in Rs 100 denominations, but they could or did not do so. We were provided Rs one crore. However, we have six branches in north coastal AP which means we can give each branch only Rs 1 crore. How is this sufficient to provide to customers coming to the bank and also at ATMs? We need at least Rs 25 lakh per branch to meet the requirement.”
Furthermore, he said, “RBI has given instructions that Rs 50,000 can be withdrawn from current accounts and Rs 24,000 from savings account per week, but we are not having that much money to give the customers as we are not receiving the funds from the major banks.”
Similarly, another manager said, “We have salary accounts of several colleges and they will be giving the salaries on December 1. How can we pay all of them that money when we are not receiving sufficient amount?”
Meanwhile, majority of the ATMs in the city remained closed due to lack of sufficient cash on Wednesday. However, the ATMs which were functioning were dispensing only Rs 2,000 notes. “I have been trying to withdraw Rs 100 notes for four days now and not able to get it either in the bank nor in ATMs,” said Jaya Lakshmi M, who was waiting in line to withdraw cash from an ATM near Waltair Uplands.