Demonetisation: Cash crunch back with a vengeance?

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The cash woes have returned. After a brief relief post demonetisation, several ATMs in the past two days have been running dry. Some ATMs only dispensed the Rs 2,000 notes which once again has caused a cash crunch.

People stand in long queues outside an ATM at a bank to withdraw cash after the ban on old high denomination notes.

With an estimated Rs 15.44 lakh crore sucked out of the system thanks to demonetisation, ATMs and banks had fallen short of cash. There is still a deficit in terms of what is being provided to the ATMs. Prior to demonetisation, the amount provided to the ATMs was Rs 13,000 crore per day. However, today the figure stands at Rs 12,000 crore.

Officials say that the cash crunch at the ATMs is because there were large withdrawals in the past couple of days after salaries were credited. At least one fourth of the ATMs are running dry today and normalcy is expected to return by February 10, officials also point out.

The crunch is also due to the RBI allowing withdrawals of up to Rs 24,000 from ATMs. This was bound to cause some amount of cash crunch officials said while also adding that normalcy will be restored in the next couple of days.

While officials are optimistic that the crunch would end in the next couple of days, those in the banking sector feel that it may take at least another 20 days. It would depend on the cash flow into the banks and the ATMs bank officials point out. Banks officials however point out that the situation is much better today when compared with November and December after Prime Minister Narendra Modi announced that the Rs 500 and 1,000 notes would no longer be legal tender.

OneIndia News

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