Bank employees urge Centre to address cash crunch issue immediately

For the past few weeks, banks in many states have been experiencing an unusual cash crunch and the public is facing innumerable problems

The bank employees' union has urged the government to take immediate action to address the cash crunch issue at banks. The employees have threatened to launch a protest iIf the government fails to address the problem.

They have also raised doubts on whether cash from banks is finding its way to states like Karnataka, where elections are scheduled on May 12.

C H Venkatachalam, General Secretary, All India Bank Employees Union (AIBEA), said that mere statements will not help much. There should be a concrete action. 

“If timely and immediate action is not taken to improve the supply of currency notes, AIBEA will be compelled to ventilate the anger and agony of the banking public through agitations," he said.

For the past few weeks banks in many states are experiencing unusual cash crunch and the public is facing innumerable problems. The bank employees are facing the wrath and anger of bank customers for no fault on their part, he added.

The inadequate supply of currency notes by the Reserve Bank of India (RBI) has been a problem ever since demonetisation was announced on November 8, 2016.

RBI controls the money supply in the economy taking into account the supply and demand of currency notes, etc. But within the decided quantum of the money supply, when number of Rs 2000 Notes are printed, there is a natural shortage of small denomination notes like 50, 100 and 200 which are most needed. Rs 2000 Notes constitute the bulk of currency supply and hence there is a shortage of Notes of small denominations.

Government’s introduction of Financial Resolution and Deposit Insurance Bill (FRDI Bill) in the Parliament has added to the fear of the banking public. FRDI Bill contains a Bail-in clause by which the government can utilise the public deposits of customers in the banks to offset the losses of banks.

RBI Governor has made a statement that there is adequate printing of currency notes. Then why is there a cash crunch?