Small businesses in the service sector ranging from registration of property to hotels and restaurants continue to be hit by the currency crunch triggered by the demonetisation of higher-denomination notes.
“Sale of perishables such as fish and vegetables has slowed down. Prices of vegetables are low and no cash transactions are taking place for wholesale purchase or retail sales,” general secretary of Ernakulam Market Stall Owners’ Association N.H. Shameed said on Tuesday. The continuing currency crunch has cooled vegetable prices. The prices of nendran banana and vegetable cowpea are the only ones in the higher range. The price of nendran was Rs.60 a kg in the retail market while cowpea was selling for around Rs.40 a kg. The other vegetable prices were down, said Mr. Shameed.
State general secretary of Kerala Hotel and Restaurants’ Association Aziz said business was down more than 40 per cent in the city. The situation was worse in the suburbs where small denomination currency notes are still not freely available. “It is not possible to provide change for Rs.2,000 notes and most often customers are turned away,” he said. But he expects the Reserve Bank of India to solve the problem in the immediate future.
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Transport operators said the situation had improved over the weekend. But trade union sources said collections by the Kerala State Road Transport Corporation (KSRTC) was down.
A document writer in Aluva said registration of property had come to a grinding halt in most sub-registrar offices. “While the property deals may have been settled, people are unable to pay the registration and other fee because none of the offices are accepting the demonetised currency notes. Though the RBI had said that these notes would be accepted for government services, they were not being accepted,” he said.
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He also said if the government came forward to settle the currency crunch, the situation could improve and registration could come back to normal levels.
Retail sale of fish has picked up momentum since Monday with the fishermen and fish brokers reaching a consensus on payment arrangements. “Though fishermen are not getting the entire dues at one go, they are able to get enough money for sustenance,” market sources said.