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Rediff.com  » Business » Banks brace for coming pay rush as salary day approaches

Banks brace for coming pay rush as salary day approaches

Last updated on: November 30, 2016 10:06 IST

Branch networks will give preference to pensioners and labourers for withdrawing money, report Business Standard's Abhijit Lele and Arup Roychoudhury.

A queue outside a Mumbai bank in the early days after demonetisation.Banks are bracing for higher pressure in early December, as people queue at their branches and ATMs to withdraw salaries and pensions in cash, amid the currency note crunch.

Branch networks will give preference to pensioners and labourers for withdrawing money.

The weekly withdrawal limit of Rs 24,000 for a savings account and Rs 50,000 for a current account is adequate, senior public sector bank executives said.

The Reserve Bank of India infused new notes worth Rs 2 lakh crore between November 10 and 25. This is almost equal to the currency notes supplied in a normal year.

Even so, with the apprehension about being short on currency, customers have taken out cash in large amounts. Much more could be withdrawn in the first 10 days of December.

"The real challenge will come from supply of currency from RBI, which is not coming in adequate measure," said a PSB chief executive.

An official involved with the demonetisation process said banks have been told to ensure enough money for disbursing to companies. And been assured that there will be adequate supply from the RBI.

Government employees up to grade-III have already been given part of their November salaries (Rs 10,000) in cash.

It has been left to private companies to decide on such provisions for their employees.

The Centre has requested the private sector to encourage employees to use cashless methods for transactions.

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Officials are of the view that there would now be hardly any employer whose employees will not have bank accounts.

IMAGE: A queue outside a Mumbai bank in the early days after demonetisation. Photograph: Prasanna D Zore/Rediff.com

Abhijit Lele and Arup Roychowdhury
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