Scuffles erupt at banks, Finance Minister Arun Jaitley sees easing December 30

New Delhi: As reports of scuffles breaking out at banks poured in from across the country and queues outside banks and ATMs continued to grow, Prime Minister Narendra Modi appealed to the people on Friday to “lead the change” towards cashless transactions to lay the strong foundation of an India where there was no place for corruption and black money.

Finance Minister Arun Jaitley said on Friday that the cash crunch which followed the scrapping of high-value notes would ease by December 30 with the release of new Rs 500 and Rs 2,000 currency notes.

The Prime Minister said large volumes of liquid cash were a big source of corruption and black money. “I urge all of you, particularly my young friends, to lead the change and inspire others to turn towards cashless transactions. This will set the strong foundation of an India where there is no place for corruption and black money,” the PM said in an article posted on LinkedIn. “Today, we live in an era of mobile banking and mobile wallets. Ordering food, buying and selling furniture, ordering a taxi... All of this and a lot more is possible through your mobiles. Technology has brought speed and convenience in our lives,” he added.

Reports of scuffles have been coming from Uttar Pradesh, Manipur, Madhya Pradesh and Hyderabad, among other parts of the country, with tempers rising as people are not able to get cash despite statements from the RBI and top government officials that there was sufficient availability of currency notes in the country.

The payday rush that started on Thursday has made things worse as the banks are running out of cash even before noon, with the demand outstripping supply. The ATMs, despite being recalibrated for the new currency notes, are also running dry as there are not enough new notes to fill them up. People have been forced to hunt for ATMs filled with cash and long queues start getting formed even when the staff are filling them with currency.

People are desperately trying to get cash to pay for their various expenses at the start of the month, such as paying wages to their domestic helps, drivers and cleaners and to buy grocery items, among others things.

A number of banks have been forced to start rationing cash withdrawals despite the RBI allowing every person to withdraw Rs 24,000 per week.

There are reports suggesting that bank branches from all over the country did not get sufficient cash to take care of payday withdrawals. Banks have been making SOS calls to the Reserve Bank to provide additional cash to meet the payday rush for another four to five days.

The banking employees association, in a letter to the finance minister, has said that demonetisation has resulted in “tensions, exchange of words, quarrel, abuses, insults, insinuations on bank staff, commotion bordering on physical and mental pressure on the staff for no fault of theirs”. The All India Bank Employees Association has demanded that the RBI should take steps to supply adequate cash to all banks and details of notes supplied to the banks “should be announced publicly by the RBI on a daily basis”.