New Delhi, Decmeber 15: Today is the last day to use your old Rs 500 notes for paying utility and hospital bills and purchasing cooking gas cylinders. Economic Affairs Secretary Shaktikanta Das addresses the media to update about the demonetisation efforts of the government.
On November 8, Prime Minister Narendra Modi announced demonetisation of Rs 500 and Rs 1000 notes to cease black money and counterfeit currency in circulation. Since the unprecedented note-ban has been imposed on India, snarling bank and ATM queues have become order of the day.
Although the government has granted a weekly withdrawal limit, banks are failing to serve the customers due to shortage of new currency despite record 85 % of cash deposits in banned currency notes. The Finance Ministry and RBI have repeatedly said actions were being taken to improve the situation, however people are bound to spend hours in queues to withdraw money every day. As a result, households and businesses have been affected massively due to cash-crunch.
While Economic Affairs Secretary Shaktikanta Das said banks are preferring to supply cash via branches to their customers than through ATMs. He also said at the same time that more than 2 lakh ATMs have been already re-calibrated out of total 2 lakh 20 thousand ATMs in the country.
It would be interesting to note here that, as per Das ATMs are cashless deliberately by banks and not due to cash crunch. That would also mean that banks are probably worried about the transactions at ATMs as recently the news was rife that more than 75 % of Indian ATMs are running on outdated Windows support.
Das also revealed that total number of notes in lower denominations of Rs 100 and below supplied in last 5 weeks is 3 times of what RBI supplies in an year.
Regarding the raids and surveys of ED, Das said they are taking up #surgial action on illegally accumulated money. The actions are based on specific tip offs said Das.
Das also assured that airlifting of currency would continue wherever necessary, particularly to rural areas to ensure enough cash supply. Rural India has suffered the most after the demonetisation of Rs 500 and Rs 1000 as largely banks are located remotely in rural areas.
On Rs 2000 and Rs 500 notes, Das said intial focus was to supply Rs 2000 notes as a replacement value and thus it was taken out of the market. But now the focus is on printing more of Rs 500 notes. Meanwhile the country is going through a financial emergency in the absence of enough Rs 500 notes since last 37 days of noteban.
Hailing government’s efforts, Das said it is for the first time that currency bills were indigenously designed in-house with security features. This makes notes more secure with less chance of counterfeiting.
However several people with fake new currency have been found in the last 30 days.
He reiterated, there is the least possibility of counterfeiting new 500 and 2000 notes and they are completely indigenous.
On US Fed rate hike, he said our markets had already factored in the rate hike and they would remain fairly stable.