Published: Tue, April 17, 2018
Business | By Tara Barton

Cash crunch returns as ATMs in many states go dry

Cash crunch returns as ATMs in many states go dry

More than a year after Prime Minister Narendra Modi sensationally announced the note ban, people have begun bear the brunt of fresh cash crunch in three big states once again. Madhya Pradesh Chief Minister Shivraj Singh Chouhan has alleged a conspiracy behind Rs. 2,000 notes vanishing from the market. Expressing resentment on the banking system the NSUI staged demonstration by garlanding the ATM machines while also expressed concern on growing problems in banking due to shortage of cash in banks.Eminent those who staged protest includes Sachin Rajak, Moonesh Sonkar, Ashutosh Singh, Karam Tamsetwar, Mohd Ali, Shubham Yadav, Bengo, Yogesh Chakrabarty, Gaurv Abindra, Sumit Khateek, Rahil Pandey, Sanjay Vishwakarma and others. Government has formed state-wise committee & RBI also formed committee to transfer currency from one state to other.

Meanwhile, MoS for Uttar Pradesh SP Shukla quoted in ANI saying, "We've cash currency of Rs 1,25,000 crore right now". There is one problem that some states have less currency & others have more. Bank officials said that people have been withdrawing cash more than they require at the beginning of the month.

Interestingly this challenges the government's own claim that post-note ban, the use of currency has gone down and more digital transactions are taking place.

A senior finance ministry official said, "We held a meeting with the RBI officials, banks, and states today (Thursday). The temporary shortage caused by sudden and unusual increase in some areas is being tackled quickly". We need to pay for the admission of children and purchase groceries and vegetables, ' said a common man from Varanasi. "We moved through six ATMs fetching for cash in different banks on Anandnagar Road and Bodakdev, however, all of them had run out of cash", said Shamik Das, a resident of Satellite.

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The Congress party also slammed the government for the cash crunch, questioning if the cash shortage was deliberate. "We are facing a cash crunch".

People of various cities including Delhi, Varanasi, Bhopal and Hyderabad are struggling as ATMs are running dry, creating a situation of a severe cash crunch. After the demonitisation exercise, the currency in circulation increased to Rs. 16,50,000 crore.

Puneet Sharma, a trader at Lucknow's Aminabad market compared the situation to that after the government scrapped high-value notes in November 2016. The situation has been the same since last 15 days.

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