Andhra Pradesh

Cash crunch hits banks in Srikakulam, Vizianagaram districts

People in queue at an SBI ATM in Amadalavalasa in Srikakulam district

People in queue at an SBI ATM in Amadalavalasa in Srikakulam district   | Photo Credit: arrangedbyK_SRINIVASARAO

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Disbursement of pensions a major challenge

Banks have been facing a cash crunch both in Srikakulam and Vizianagaram districts, ahead of disbursal of pensions in the first week of March.

Srikakulam district needs around ₹35 crore currency but the availability is only ₹25 crore in spite of the support from nearby Odisha bank branches. The same is the case with Vizianagaram where all branches need around ₹28 crore to make pension payments to elderly people, leave alone requirements of other bank customers.

The banks are not in a position to mobilise huge cash immediately, according to highly placed sources.

Srikakulam Collector K. Dhananjaya Reddy and Vizianagaram Collector Vivek Yadav talked to senior bank officials and lead bank managers to overcome the shortage since poor people need to get their ₹1,000 pension under social welfare measures.

This apart, retired employees also go to banks in the first week to withdraw cash for their regular needs.

Lead bank managers T.Guravayya and P.Venkateswara Rao of Vizianagaram and Srikakulam respectively were told by the Collectors to make alternative arrangements for smooth disbursal of pensions to poor people.

According to some officials, after demonetisation, many people are not keen to do regular transactions with banks. Many traders are also depending on cash transactions. Owing to bank charges, withdrawal limits and other reasons many people have stopped depositing money in the banks.

Deposits down

In the last six months, about ₹1,000 crore worth of deposits were withdrawn from 335 branches of various banks in Srikakulam district.

The total deposits have come down to ₹9,070 crore as against ₹9,500 crore by end of December and to ₹8500 crore by February-end, according to a senior officer.

“The currency which goes into circulation is not coming back to banks. We are depending on banks in Berhampur, Jaypore and other parts of Odisha to meet the payment compulsions during the first week of a month,” he added.

“We have brought the issue to the notice of the Reserve Bank of India which has suggested us to manage cash flows within the district. Normalcy cannot be restored unless customers come forward to deposit their amounts as usual,” said another bank official.

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Printable version | Jan 24, 2020 10:05:05 AM | https://www.thehindu.com/news/national/andhra-pradesh/cash-crunch-hits-banks-in-srikakulam-vizianagaram-districts/article22912368.ece

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