Getting one’s own money as and when required, under ordinary course of business, should be hassle free. The relation between a customer (depositor) and the bank is based purely on trust. This trust, out of which emanates assurance about the safety of money with a bank is normally ultimately parked at the fact of liquidity which means withdrawing the money as per requirement. With more and more developments in banking services with intent to provide the best and the quickest service to a depositor customer, ATMs are one of the most popular modes provided by modern banking system. They work 24 hours. Having said so, how does it look like when many of them have no cash to dispense with?
Like a few cities in the country suddenly experiencing many ATMs going “dry”, people in Jammu region too have been facing the same difficulties for a couple of days but not of very serious nature. The position in most of the rural areas, however, is reported to be worse. Rajouri and Poonch, areas in Pir Panchal like Mendhar, Surankote, Mandi, Thanamandi, Darhal, Nowshera etc and other areas like Kishtwar, Doda, Ramban, Banihal, Reasi and many parts in Udhampur and Kathua have been bearing the brunt of non availability of cash.
The Government, undoubtedly was caught unawares because it went by its own calculations of inducting fresh currency in the circulation as the figures suggest like in September 2017 , currency with the public was to the extent of Rs.14.9 lac crore while it was Rs.17.5 lac crore as at the end of March 2018. However, there are a few reasons for this cash shortage at certain areas in the country, namely fresh notes of the denomination of Rs. 2000 are no longer printed. Secondly, there is possibility of hoarding of notes of Rs 2000 due to approaching elections in certain states and the General Elections. Thirdly, there is always high demand on cash post harvesting period. Fourthly, the Indian economy is showing positive results and is picking up fast as corroborated by the World Bodies too like the World Bank etc; pushing up the demand. Last but not the least, the payments made of salaries, wages, bonus etc at the end of the fiscal.
It is, however, intriguing as to why monthly demand shot up unusually during the last few months from Rs. 20,000 crore to whooping Rs. 45000 crore. The causes need to be known and stern action initiated as the scenario had the potential of financial crisis coupled with shaking public faith in the banks in a situation of mounting NPAs and writing off bad debts having put strains on the financial health of the banks.
There is no cause of any panic and the criticism by some political parties as the present difficulty being “Note Ban Terror” is unfounded since an amount of Rs. 18.3 lac crore of currency is with the public, much higher than at the time of the demonetization. Besides, the printing of notes has been increased fivefold, that of Rs. 500 denomination notes. Customers could, as a last and immediate resort, walk into the bank branches to transact withdrawing money till ATMs are replenished with adequate cash in the affected areas. The Finance Minister Arun Jaitley has assured the public of there being “more than adequate” currency in circulation and the temporary shortage in certain states is being “tackled quickly”.
While ATMs in Jammu and other parts of the State need immediate replenishments of cash, the Reserve Bank of India is requested to regularly monitor the demand and the supply of cash and take steps in anticipation instead of doing crisis management later. The propensity to hoard and stock up on cash, however, must be avoided by all means and no space provided to panic getting a commanding position, not in the least.