Banks to remain closed for 3 days in a row, expect huge demand for cash after break

Bank customers continued to line up outside branches and ATMs as banks faced the uphill task of meeting the huge demand for cash ahead of three-day break.

Banks will remain closed in many places for three days in a row on account of ‘Id-e-Milad’ on Monday.

Bankers are anticipating huge rush for withdrawals when they open for public dealing after the break.

The situation at bank branches has not improved as ATMs are still not dispensing adequate cash despite being recalibrated for new currency notes.

Bankers on the condition of anonymity said that despite assurances by RBI and government, they are not getting adequate cash from currency chests to meet the withdrawal pressure on account of pay day.

A private sector banker said that although about 95 per cent of over 2 lakh ATMs have been recalibrated, there is cash shortage due to logistics issue. ATMs are fed only once a day and most of them are running out of money shortly due to heavy withdrawals.

Bankers expect that the situation would continue for another 10-12 days.

Faced with acute shortage of cash, banks have imposed their own limits for withdrawal as low as Rs 2,000 in some cases against the limit of Rs 24,000 per week set by RBI.

Frustrated with standing in long queues people at times venting their anger at bank officials asking them to compensate them for not being able to keep their promise of providing Rs 24,000 per week to a person, similar to what bank charges when a customers fail to maintain minimum balance in the account.

“Because of the acute short supply of cash, and when branches are unable to meet the requirements of cash withdrawals, irritated customers are naturally becoming angry, and annoyed and their anguish is turned towards the staff, officers and managers,” All India Bank Employees’ Association said in a statement.

Some banks are disbursing only Rs 2,000 per person while those having better cash availability are offering Rs 10,000-12,000 per withdrawal against specified limit of Rs 24,000, bank officials said.

To promote less cash economy, the government on Thursday announced slew of measures incentivising payment through digital mode for purchase of petrol, diesel, insurance cover, railway tickets etc.

It also waived service tax for payments up to Rs 2,000 made through cards and decided to do away with transaction fee for payment to central government departments and PSUs.