Demonetization of Rs500, Rs1,000 notes has led to financial chaos: Bank unions
Vadodara: Two leading bank unions on Monday criticized the government over demonetization of Rs500 and Rs1,000 notes, saying the move has led to “financial chaos” across the country.
In a letter to Indian Banks’ Association (IBA), All India Bank Officers’ Association (AIBOA) and All India Bank Employees Association (AIBEA) said the decision to withdraw the high-value notes was taken without proper planning or preparation. They also highlighted heavy work pressure on employees and officers at bank branches in the wake of demonetization which has led to customers rushing to exchange the now defunct notes.
“Chaotic situation is prevailing at the bank branches and this is unbearable for both customers as well as bank employees and officers,” S Nagarajan, general secretary of AIBOA, and C H Venkatachalam, his counterpart at AIBEA, said in the letter to IBA, the apex body of bank managements.
There is a huge shortage of Rs100 notes which are now in great demand for routine needs, while most customers are not willing to accept the new Rs2,000 bill, they said. “The centre and the Reserve Bank must be fully aware that already there is a huge gap between the indent and supply of Rs100 notes. For example, in 2015-16, as against the indent of 535 crore pieces of Rs100 notes, the supply received was only to the tune of 490 crore pieces,” according to the letter. “One cannot understand the reason behind banning the existing Rs500 notes and not providing new supply of Rs500 notes in time,” it added.
Most of the 2.20 lakh ATMs across the country are closed or partly functional. This has put additional pressure on the staff and customers are compelled to visit branches to withdraw cash from their accounts, the two unions said. Nagarajan and Venkatachalam requested the IBA to ensure the RBI supplies adequate cash in denominations of Rs100 and new Rs500 notes to ease pressure on banks and provide relief to customers.