Cash crunch will continue to haunt for next 4-5 months, says bank association

If you thought the cash crunch situation would ease after December 31, the bank association has some grave news for you. The Bank Employees Federation of India (BEFI) said currency note shortage will continue for another four to five months, even if the country's all four currency press facilities work at optimum capacity.

Demonetisation has stirred a cash crunch situation and people are still standing in queues to get their money exchanged or deposited. Now, they can only exchange their old banknotes at RBI counters but continue to deposit old notes at the banks.

"Cash shortage will continue even if the four currency note printing presses run at their optimum capacity. It will take four to five months to restore normalcy in cash supply," bank employees' union BEFI general secretary P K Biswas said.

BEFI feels that the cash crunch will make the people desperate next week as they will be receiving their salaries and would want to withdraw it.

The situation "can turn worse" in a week or so if the customers face difficulties in withdrawing their salaries from banks and ATMs, BEFI said.

He also said that some people have vandalized bank properties in some branches of the public sector halted banking operations due to cash shortage post-demonetisation.

As on March this year, there were 15,707 million pieces of old Rs 500 notes and 6,326 million pieces of Rs 1,000 notes in circulation, the union said.
(image: IndiaTimes)