Concrete action required to address currency shortage: AIBEA

All India Bank Employees Association (AIBEA), representing the banking industry, today said concrete action is required by the Reserve Bank to address the cash crunch and warned of a protest on the issue.

"If timely and immediate action is not taken to improve supply of currency notes, AIBEA would be compelled to ventilate the anger and agony of the public through agitations," the association General Secretary, C H Venkatachalam said.

AIBEA is part of the United Forum of Bank Unions, which is an umbrella body of nine unions, including All India Bank Officers' Association and National Organisation of Bank Workers across the country.

Venkatachalam said bank employees were facing the wrath and anger of customers due to the cash crunch.

Noting that the currency note shortage has become very acute in several states, he said, "many bank branches do not have sufficient cash to cater to withdrawals by customers".

Reserve Bank of India controls the supply of money in the economy, and when more number of Rs 2,000 denomination notes were printed, it is natural that there will be shortage of small denomination notes, he said.

"Rs 2,000 notes constitute the bulk of currency supply and hence there is a shortage of notes of small denominations... viz Rs 50, Rs 100," he said.

Venkatachalam claimed that even after the completion of 16 months following the announcement of denomination by Prime Minister Narendra Modi in November 2016, ATMs were yet to be "recalibrated" to disburse newly designed currency notes.

"This is adding to the problem of shortage", he said.

The government's decision to allow Financial Resolution and Deposit Insurance Bill 2017 has added fear among the public as the Bill contains a clause by which Government can utilise the public deposits of customers in banks to offset losses of banks, he said.

With increasing bad loans and frequent frauds in banks, customers get a fear whether their bank deposits will be safe, he said.

"The RBI Governor has made a statement that there is adequate printing of currency notes. Then where have the currency notes gone?," Venkatachalam wanted to know.

"It is high time that the present RBI Governor owns up and resigns or should be removed. RBI is grossly negligent. It is the duty of RBI and government to dispel these fears among the public," he said.