₹2,000 notes reach banks amid hiccups

Four-month window opens amid complaints that some bank branches sought identity proof; banks say there is cash to cater to the demand

May 23, 2023 12:10 pm | Updated May 24, 2023 12:20 am IST - New Delhi

Withdrawn ₹2000 banknotes are exchanged at a counter in a bank in Bhopal on may 23, 2023.

Withdrawn ₹2000 banknotes are exchanged at a counter in a bank in Bhopal on may 23, 2023. | Photo Credit: A.M. Faruqui

The four-month window to exchange ₹2,000 currency notes opened on Tuesday with small queues and confusion at some banks over the requirement of identity cards such as PAN or Aadhaar, and requisition slips.

The Reserve Bank of India (RBI) on May 19 announced withdrawal of ₹2,000 banknotes from circulation in pursuance of its ‘Clean Note Policy’. The central bank advised the public to deposit such notes into their bank accounts or exchange them for notes of other denominations at any bank branch, up to a limit of ₹20,000 at a time, by September 30.

While the RBI has not made the presentation of a valid ID or filling of deposit forms mandatory, there were complaints from some places that banks were demanding customers to submit identity cards as proof.

Scores of people lined up outside banks in Delhi as the temperature hovered around 43 degrees Celsius. Chaos and confusion prevailed over the process of exchange of notes which left people, especially the elderly, disgruntled.

Nearly 100 people turned up at a Union Bank branch in Connaught Place to exchange ₹2,000 notes.

Manoj Kumar, a customer of HDFC bank, said though he wanted to exchange 20 notes, he was asked to give only 10 by the bank staff. “I didn’t know how much money can be exchanged so I brought all I had. I will come again tomorrow to exchange the rest,” he said.

Most of the banks claimed that the process remained smooth on day one. “People had some confusion regarding how much currency they can exchange or should they deposit the same in bank or get them exchanged. We managed to solve their queries,” said a customer care executive at a HDFC branch at ITO, where 26 people turned up to exchange the notes.

At an ICICI branch in the same area, 35 people had turned up to exchange notes.

Many people complained that grocery stores and petrol pumps refused to take ₹2,000 notes citing lack of change. At some places, shopkeepers had placed a cap of “at least 50% purchase” in case customers had ₹2,000 notes.

“I had to argue with the staff at a supermarket for over 20 minutes as the manager wasn’t ready to take my ₹2,000 note, even when I kept telling him that it’s legal tender. I was forced to buy things worth ₹1,000 so that he would give me change,” Alpana Sethi, a resident of Rajouri Garden, said.

Rakesh Pruthi, who tried to use ₹2,000 note at a petrol pump in Hari Nagar, said the attendant told him that they had run out of change as they were getting only ₹2,000 notes from customers since Friday.

There were no reports of rush at the counters of state-run banks in Kolkata. About a dozen people had gathered outside the RBI State headquarters at Dalhousie around 11 a.m. They were allowed to go inside in groups of five to exchange their notes. Some people who had queued up were carrying only two or three notes.

Bank branches in Odisha too did not witness any unusual rush. Chandra Sekhar Sharma, chief general manager of SBI, Bhubaneswar Circle, said the bank had ₹12,000 crore in ₹500 and ₹200 denominations in 64 chests. People can exchange ₹2,000 notes in 890 branches across the State. Even one person can exchange ₹2,000 notes multiple times in a day.

In the past two days, the SBI had seen estimated deposit of ₹2,000 notes to the tune of ₹50 crore daily at various branches and Automated Deposit-cum-Withdrawal Machines (ADWM), Mr. Sharma said.

“The Reserve Bank of India has given a fairly long period for exchange of notes. We need not have to jostle for space in queues in the peak summer. I have come here to study the process,” said Kishore Mishra, a resident of Bhubaneswar, who visited an SBI branch.  

Banks in Kerala also did not experience any unusual rush, officials said. ‘‘People visited our branches to get the notes exchanged, but no headlong rush was reported,’‘ a senior official of the State Bank of India (SBI) in Thiruvananthapuram said.

The Kerala Bank (Kerala State Cooperative Bank) also did not experience ‘panic queues’ to get the notes replaced.

Major banks, including the SBI and the Kerala Bank, have made special arrangements for the elderly and the differently-abled.

On Tuesday, some branches requested identity proofs for replacing the notes.

Bank officials pointed out that ₹2,000 notes were not commonly seen in day-to-day circulation nowadays. Many banks had also ceased loading the notes in ATMs a while ago.

With digital transactions catching on, it is very rare these days to see someone hand over a ₹2,000 note over the counter, said traders.

‘‘Cash payments have come down drastically with customers opting for online payment even for small amounts. Not many people have these notes nowadays, but traders are accepting ₹2,000 notes as it is still legal tender,’‘ S. S. Manoj, national secretary, Confederation of All India Traders (CAIT), said.

He, however, expressed concern that some people may use unsuspecting traders to clear out their unaccounted money kept in ₹2,000 notes.

Banks in Telangana said some branches saw more than usual footfall, but primarily of customers who came to deposit ₹2,000 notes in their accounts.

Most banks, anticipating a rush of customers, had drawn up plans, including operating an additional cash counter, if required. Such measures were, however, not necessitated as the number of customers was manageable, according to sources in public, private and regional rural banks.

Customer remittances by way of the ₹2,000 notes had increased ever since the RBI on May 19 announced the decision to withdraw them, the sources said.

The footfall particularly had increased in bank branches catering to high-net-worth individuals, companies and those located near business and shopping hubs and designated to accept payment towards government challans. Current accounts linked to petrol bunks and wine shops also saw a heavy influx of the Rs.2,000 notes, sources said.

It was a bitter experience for the people at the branches of a few private banks in Andhra Pradesh as officials refused to exchange notes in places such as Rajahmundry and Kakinada.

“We do not have adequate staff to meet the demand from customers seeking exchange of ₹2,000 notes. We are flooded with too many deposits from the account holders,” said a senior staff member of a private bank in Rajamahendravaramu.

People were seen arguing with private bank employees over the exchange process. However, they were told to visit public sector banks.

The situation at public sector banks was smoother. The rush was thin to moderate at many branches in Vijayawada.

(With inputs from Kolkata, Thiruvananthapuram, Bhubaneswar, Hyderabad, Vijayawada, and PTI)

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