In the post-demonetization period, next few days are likely to be a miserable `acid test’ for bankers as disposing salary bills throws a big challenge for them. Banks across the country are bracing themselves to face this extraordinary situation— meeting month-end demand of lakhs of salaried employees and pensioners.
They are setting internal daily cash withdrawal limits per account, while the government has asked private companies to make payments to employees digitally. Though banks are putting `brave face’ stating that they are prepared to manage the situation, they are reportedly suggested to large companies that they should give prepaid payment cards to their employees in lieu of cash.
The major worry is that bankers are unable to estimate actual cash demand for the next couple of days. Government agencies and most of private companies are making online payment of salaries since a long. People hardly withdraws their total salaries in the beginning of a month. But due to fear of cash crisis, panic driven public are expected to resort for high amount of withdraws.
Already most of the employees unions have been insisting the government for payment of their salaries full amount in cash for this time. Bank sources says they can realise actual demand for cash withdrawals only after people rushes into banks. Both the state and central governments are making arrangements for payment of Rs 10,000 of salaries in the form of cash.
Banks are failing to meet month-end requirements of cash flow. Though the government ensures daily ATM withdrawal limit of Rs 2,500 and weekly cash withdrawal limit of Rs 24,000 from the branches, banks are hardly equipped with suitable cash inflow. According to bankers they are getting only 35-40 per cent of the total cash requirement from RBI.
That’s why many of ATMs are turning dry. However, as slowly many have now started using digital mode for various transactions, bankers are hopeful that the pressure for cash flow will come down a bit.
It is known that many bank branches have been receiving only one-eighth of the cash that is usually disbursed daily, with restrictions on cash disbursal kicking in over the last week. Some large public sector banks are said to be rationing their cash holdings by releasing less currency to their branches.
