Thursday , 8 December 2016
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Government Takes Steps To Boost Cash Supply, Extends Use Of Old Notes

New Delhi: With no end in sight for the cash crunch faced by millions, the government has eased restrictions on withdrawal of alternate currency and extended by 10 days deadline for use of the defunct 500 and 1000 rupee notes for paying utility and fuel bills.

The Finance Ministry took a series of steps to increase cash supply in the system, including introducing a new 500 rupee note in the recalibrated ATMs. About 1.3 lakh branch post offices will be stacked with cash and hundreds of new micro cash machines will be installed across the country.

Also, a Task Force was set up to expedite process of recalibration of ATMs as well as draw up action plan and ensure implementation of this action plan for quick changeover to enable them to dispense new bank notes of Rs 500 and Rs 2000.
The measures followed ever increasing queues at banks growing even after nearly a week of the government decision to withdraw higher denomination notes. Today being a bank holiday in northern and western India, long queues are expected tomorrow with people wanting to withdraw money or swap the old 500 and 1000 rupee notes.

About half of the ATMs have not yet started functioning and wherever were operational ran out of cash in no time.

Economic Affairs Secretary Shaktikant Das said the government has also raised cash withdrawal limit of at least three-month old current accounts to Rs 50,000 per week and ATMs would start dispensing new 2000 rupee notes within two days.

The government extended use of old defunct Rs 500 and Rs 1,000 notes for paying household utility bills, fuel, taxes and fees and purchases from cooperative stores till November 24.

While withdrawing Rs 500 and Rs 1,000 notes from the intervening night of November 8-9, the government had allowed use of the old currency at government hospitals, railway ticketing, public transport, airline ticketing at airports, milk booths, crematoria/burial grounds and petrol pumps for 72 hours.

This list was later expanded to include payments for metro rail tickets, highway and road toll, purchase of medicines on doctor prescription from the government and private pharmacies, LPG gas cylinders, railway catering, electricity and water bills and ASI monument entry tickets.

As banks struggled to give alternate currency, the deadline was extended by another 72 hours. That deadline was to end at midnight tonight, but has now been extended till November 24, he said.

Old currency can also be used for purchases at consumer cooperative stores like Kendriya Bhandar with valid ID proof as also for paying court fee.

But payments towards utility bills will be restricted to only individuals or households for arrears and/or current bills. No advance payments will be allowed.

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