Faced with currency shortage and long queues, banks today resorted to rationing of cash at many branches countrywide but met with limited success to handle the huge pay-day rush, while ATMs continued to remain mostly dry, causing hardship to people seeking to withdraw money.
People in several parts of Tamil Nadu even braved heavy rains to get money for their household expenses, while long queues started building up in wee hours before ATMs and bank branches for withdrawal of start-of-the-month expenses on the first post-demonetisation pay day across several other states including Kerala, Gujarat, Maharashtra, Punjab and Haryana.
Having got much less than their regular requirement from the currency chests, many branches ran out of cash in post- lunch hours, even as people complained about being given money even below the permitted withdrawal limits at branches.
Long queue were visible at many places for withdrawal as a large number of ATMs are still not functional. Even the functional ATMs at many places could dispense only Rs 2,000 notes, leaving the customers without lower denomination notes.
Frustration and anger were also visible at many places in semi-urban and rural areas where banks and ATMs soon ran dry.
Metro cities too had similar scenes at many places with patience turning into anger against bank employees for their failure to provide currency other than Rs 2,000 notes.
Bankers said on their part that the situation is expected to continue for another 6-7 days because of withdrawal rush from salaried and pensioners.
Despite claims by various banks that adequate arrangement would be in place to handle the pay-day rush, branches were seen not only rationing the cash, many of them also refused to entertain the non-home branch customers.
A senior public sector bank official said the branches are compelled to resort to rationing because of cash shortage and it is difficult to meet the withdrawal limit of Rs 24,000 per person set by the Reserve Bank.
Some banks were seen disbursing only Rs 5,000 per person while those having better cash availability offered Rs 10,000 or Rs 12,000 per customer.
Making things worse, a large number of ATMs remained dry even 24 days after the government scrapped Rs 500 and Rs 1,000 notes earlier this month to crack down on black money.
Banks and state treasuries in Kerala witnessed heavy rush since morning, while the state's Finance Minister Thomas Issac said 42 treasuries in rural areas did not receive any cash at least till 11.30 AM.
Yesterday, a top government official had said special efforts were being made to pump in exta cash into banks to meet the heavy demand for currency notes on account of salary withdrawals but situation on the ground remained a far cry.
"As such, none of our branches are short of cash. We have ensured that enough cash is available at our branches in anticipation of higher demand after disbursement of salaries and pension in accordance with the customers demand," Canara Bank MD and CEO Rakesh Sharma told PTI.
Situation was no better in West Bengal, though there were expectations that the cash availability may improve soon after new notes start arriving from Salboni printing press in West Midnapore district.
Chief Minister Mamata Banerjee alleged that West Bengal and some other states were being discriminated against in the process of distribution of new currency notes and demanded that the RBI come out with state-wide "figures" for disbursement of cash.
Across the country, people thronged the branches as central and state governments, as also private enterprises, credited salaries to their employees. At the central level alone, there are around 50 lakh employees and 58 lakh pensioners.
Bankers said the government's move last week to provide Rs 10,000 in advance to non-gazetted staff have not provided any relief.
Many banks made 'SOS calls' to RBI for additional cash for the first few days of December to meet the initial rush of people, already fatigued standing in unending queues to exchange/deposit old notes and make limited withdrawals over the past three weeks after the demonetisation was announced on November 8.
RBI Governor Urjit Patel had said on Sunday that the central bank is monitoring the situation on a daily basis and taking all necessary actions to "ease the genuine pain of citizens" with a clear intent to normalise the things as early as possible.
In Gujarat also, banks began regulating supply of cash to their customers to meet the heavy demand amid a paucity of funds, while a number of ATMs remained inoperative.
Similar was the case in neighbouring Maharashtra, including in cosmopolitan Mumbai and its suburbs.
Kerala unit of All India Bank Employees Association said bank branches were under extreme pressure as the existing stock of currencies with them may not be sufficient to meet the needs of customers due to pension and salary disbursement.
This will lead to an 'explosive situation', the association said in a statement.
Unless the RBI urgently supplied sufficient quantity of currency notes, especially of low denomination, to all the banks, bank employees would be exposed to the wrath of customers for no fault of theirs, it said.
Bank customers complained of harassment and inconvenience at various places in Punjab, Haryana and Chandigarh as well, even as banks maintained they have made adequate arrangements to deal with the heavy rush.
Punjab Bank Employees Federation Secretary Naresh Gaur said, "We appeal to the RBI to make available sufficient cash as soon as possible to banks otherwise the situation will turn worse.