Demonetisation: Flip-flops in regulations have left banks muddled

Post demonetisation, banks are still suffering as they are trying to meet the demands of currency for more than a week. The government is also creating a lot of problems for them as it keeps on changing the regulations for exchange and withdrawal of the new currency. These flip-flops have left bank branch officials muddled.

Recently, the government reduced the limit of exchange to Rs 2,000 from Rs 4,500 which was also raised from Rs 4,000. The weekly withdrawal limit for savings bank account users had been raised to Rs 24,000 from Rs 20,000 with the limit of Rs 10,000 per day being scrapped. ATM withdrawal limits has also been raised to Rs 2,500 from Rs 2000 earlier but that was only for the ATMs that were recalibrated to take the new Rs 500 and Rs 2,000 notes.

"In the initial days, there was ambiguity over the Rs 4,000 one-time exchange, which was exploited by people. Now it has been reduced to Rs 2,000 (but) imagine how we will answer (genuine) customers who come at our branches and question us on these changes,” an employee of a state-owned bank branch told ET.

While the public position of banks is that the situation has eased, anecdotal evidence seems to suggest that this is true in some parts of the country but not others, especially NCR.
(image: IndiaTimes)

Bankers are literally struggling to keep pace with the changes in regulations.

"The government increased the withdrawal limits recently (but) we have to cater to all our customers. Cash is limited, so we have put up signage outside the branch telling customers we can only disburse Rs 15,000 to savings bank holders and Rs 25,000 to current account holders,” a private bank branch manager told ET.

For the public, there hasn’t been much relief. The raised withdrawal limits aren't of much relief, even for those who hold current accounts and need to pay employees and vendors.

"Axis Bank is giving half the money and Karnataka Bank is just giving a paltry sum. There is a lot of confusion in our minds because government says we can withdraw Rs 50, 000,” an entrepreneur from Salem in Tamil Nadu who runs a garment chain told ET.

A senior Punjab National Bank official said that staff has been instructed to put the new Rs 500 notes mostly in ATMs.

"That's another issue because at the branch counter we are mostly dealing with Rs 100 or Rs 2,000 currency notes,” he told ET.

While some mobile apps have sprung up purporting to provide information about which ATMs in any given area have cash, people have taken to tracking the vans that transport currency notes.