Wednesday, November 16, 2016

Demonetisation: Government expects deposits to hit Rs 10 lakh crore by November 24

Having garnered Rs 3.75 lakh crore through exchange and deposit of old Rs 500 and Rs 1,000 notes as on Tuesday, the government expects the final figure to surge to around Rs 10 lakh crore by November 24 when exemptions provided to use of old currency at hospitals, petrol pumps etc come to a halt. However, if these exemptions were to be extended, the figure would further climb to Rs 12 lakh crore, said a goverment official close to the development.
“The inflow into banks during the first five days of banking after demonetisation was announced stood at Rs 3.75 crore and we expect that anywhere between Rs 10 lakh crore and Rs 12 lakh crore will come back in the form of deposit in banks by individuals,” he said. “The final figure would be contingent on the period for which the exemption for use of old currency at petrol pumps, hospitals etc is extended,” he added.

Prime Minister Narendra Modi on November 8 announced the withdrawal of Rs 500 and Rs 1,000 notes in an attempt to curb black money.
Giving estimates of currency in circulation, the official said that total monies stood at Rs 18 lakh crore of which 84-85 per cent were in denomination of Rs 500 and Rs 1,000. The Reserve Bank of India has been quoting the figure at Rs 16.6 lakh crore as of end-March 2016.
While currently the government is working towards making the new currency reach the last mile in a bid to meet its demand across the country, the official said that the government is now bracing up for the currency demand from farmers that they need for purchase of seeds and fertilisers.
“With the onset of the sowing season, we are now devising means of how to move the money to the farmers for purchase of seeds and fertilisers,” said the official.
While banks are working on ensuring cash availability through branches and ATMs in urban and semi urban areas, they are also trying to meet cash requirement in remote rural areas through micro ATMs — handheld point of sale terminals to disburse cash in locations where bank branches are not present.
An IDFC Bank official said that the bank’s Aadhaar-enabled, inter-operable micro ATMs are enabling transactions of other bank’s customers as well in villages and unbanked areas of Madhya Pradesh, Andhra Pradesh and West Bengal.

-Indian Express

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