Of concern to Telangana Government and bankers is that only Rs. 1,100 crore out of Rs. 22,000 crore (5 per cent) injected into the banking system in the State so far is in small denomination currency of less than Rs. 100.
This despite repeated requests of the State Government to the Centre and Reserve Bank of India to step up supply of smaller denomination notes to ease liquidity. But, it was only in the latest despatch on Wednesday that 25 per cent of the total notes were in the denomination of Rs. 20, Rs. 50 and Rs. 100.
A cumulative effect was that a panic situation about notes was created and people were not in a spending mood. There are 3.69 crore bank accounts in 5,000 bank branches across the State and even if each account holder retains Rs. 5,000 in his purse, it is a huge amount. The situation has not improved though the RBI pumped money into the banking system every three days, a senior official said.
Digital payments
There was a quantum jump in digital mode of payments which was evident from downloads of Paytm crossing 40 lakhs in the State. The growth in transactions by Paytm was more than 1,000 per cent. About 1,000 people were added to SBI Buddy every day. These two were among 55 wallet applications in the country which were operational in Telangana, he explained.
Significantly, payments by QR (Quick Response) codes also picked up. The acceptance of digital mode at lower end of trade, including tea kiosks, was high but the bigger traders resisted. The penetration of digital mode in high value transactions was slow, he added.
It was stated that the wallets had already achieved their targets for the next four years in this situation. On the other hand, the bankers were pushing the manufacturers of point of sale (POS) devices to deliver the 30,000 machines whose order was placed. There were 51,000 existing POS machines in the State.
