You can now earn interest on exchanging old notes but there is a catch

There has been a complete turnaround in trade involving exchanging demonetised currency with new banknotes.

People who were charging 30-40% premium to convert black money into white are now willing to pay an interest on exchanging the notes.
But, the catch is the owner will have to lock in the money for a year or more.

Many traders and businessmen were charging a premium of as much as 40%, which dropped to 20-30% in the following weeks and settled at 10% a week back.

Now, there has been a total flip. If you have Rs 5 crore in cash, there are people willing to take the money off your hands and give you an interest of 6-8% after a year.

"The decrease in the payment of premium for exchange of black money and interest being offered to get people to invest their black money is probably a reflection that the black money has easily entered the system,” an economic analyst, on condition of anonymity, told ET.

Many people hoarding black money got rid of it by paying outstanding dues, debts, labour contractors, cement and steel companies, etc. Some have even distributed six months salaries in advance.

Dr Saumya Kanti Ghosh, chief economic adviser (economic research department) at SBI, told ET, “People are always finding out ingenious ways to launder black money, innovative ways are being tried out. There are always people trying to take advantage, even in the financial crisis of 2008. We can expect the government would come up with ways to tackle it.”