Business Standard

FinMin asks banks to ensure adequate cash to meet cash demand post salary transfers


Press Trust of India New Delhi
With salary day drawing near, the finance ministry has asked public sector banks to ensure enough cash to meet the heightened demand across the country amid the 21-day lockdown triggered by the coronavirus outbreak.
Bank branches have been asked to remain open for facilitating withdrawal of money to be credited through direct benefit transfer to accounts of farmers, old-age person, widow and disabled under the Pradhan Mantri Garib Kalyan Yojana.
Banks are expecting a huge number of footfalls due to expected disbursement in Jan Dhan accounts, women beneficiaries, pension accounts and PM Kisan beneficiaries, among others, in the days to come, said a senior bank official.
Besides, there will be heavy rush for the cash withdrawal starting April 1 as salaries will hit bank accounts, the official said adding that salary starts hitting account from the last working day of the month till 10th working day of a new month.
Keeping the rush in mind, sources said the Department of Financial Services (DFS), Ministry of Finance, has instructed banks to keep adequate cash as well as ATMs functional to meet demand of people.
It has also asked banks to ensure opening of as many branches as possible.
At the same time, DFS has written a letter to chief secretaries of all states to ensure easy movement of bank staff, RBI staff, staff of cash logistics companies, ATM maintenance personnel and cash vans, among others.
In view of restriction, the DFS requested chief secretaries of states to issue necessary instructions to state administration and police to ensure safe movement of these people.
"The cash logistics industry is working as per the directives of DFS and the RBI (Reserve Bank of India). We are trying our best to operate all 10,000-plus cash vans and vaults across India to ensure cash availability at ATMs. We are gearing up first week when salaries hit and ATM cash supply will be most critical," SIS India Managing Director Rituraj Sinha said.
The department has also instructed the RBI, Indian Banks' Association (IBA) and National Payments Corporation of India (NPCI) to take all necessary steps in coordination with banks and vendors to ensure that all digital payment modes are functional in an uninterrupted manner.
Finance Minister Nirmala Sitharaman on Saturday had interacted via a concall (conference call) with heads of public and private sectors banks to ensure adequate liquidity at the branches and ATMs and at the banking correspondent level while maintaining social distancing.
"Had a detailed conversation with the chiefs of banks -- public and private. Encouraging to know that they are doing their best, even during the lockdown. They are certain that they will ensure customer service without disruption. Social distancing is being adhered to as well," Sitharaman had said.
She also asked heads of banks to make sure there was adequate money in ATMs, branches and with banking correspondents.
The virtual meeting was also attended by Financial Services Secretary Debasish Panda and Joint Secretaries Madnesh Kumar Mishra and Suchindra Mishra with the Department of Financial Services.
As per the instruction issued by the finance minister on social distancing, banks have sensitised their officials at branch level.
All the branch heads are advised to make circles outside the ATMs both off-site and on-site so that social distancing is maintained and send the pictures of the same, enabling us to apprise higher authorities, the official said.
Banks have ensured that all business correspondents (BCs) are to be fully functional and activated for supplying cash and other functions.

Disclaimer: No Business Standard Journalist was involved in creation of this content

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Mar 30 2020 | 7:34 PM IST

Explore News