Government scraps Rs 500 and Rs 1000 notes!

[poloman]

Originally Posted by vishnurp99

I have been told informally that the PSU personal banks and private sector banks are not filling the ATMS close to their branch. The idea is to get their customers to come to their bank. This is also because immediately after filling up , a large number of migrant labourers come in and get money from ATMS leaving the actual customers high and dry.

Exactly my doubt. Lot of small scale laundering is happening. But what I fail to understand, how can these migrants draw money again and again weekly limit being 2500.
Now Australia also plans to demonetize $100 bills after India and Venezuela. This is interesting. One is a socialist country, one mixed and one capitalist. Every ideology converging to a common plan of action.
http://www.news.com.au/finance/econo...1a87da4e20de35

[nowwhat?]

Originally Posted by vishnurp99

I have been told informally that the PSU personal banks and private sector banks are not filling the ATMS close to their branch. The idea is to get their customers to come to their bank.

Banks seem to be making hay while the sun shines. Both times I went to Axis Bank, their Relationship Manager tried to sell me some product or the other which I refused. When my wife went, she came back wanting to buy a Max Life endowment policy until I put an end to it.

Originally Posted by poloman

But what I fail to understand, how can these migrants draw money again and again weekly limit being 2500.

Assuming these migrant workers have a bank account, they can actually withdraw ₹24,000 a week. Currency exchange has been stopped by the government anyway.

Originally Posted by poloman

Now Australia also plans to demonetize $100 bills after India and Venezuela. This is interesting. One is a socialist country, one mixed and one capitalist. Every ideology converging to a common plan of action.

IIRC the first this year was the ECB which phased out the €500 note.

However I do not believe comparisons to Venezuela are valid or appropriate. There are many in-depth reports on the crisis in Venezuela, an oil economy which is right now in a pathetic situation. That country is being run by a Satya Sai Baba devotee who is feeling the brunt of shale oil discoveries in the US, Iran's oil boost, China's slowdown, etc., all of which led to the consequent drop in oil prices. Then there is also the fact that his predecessor had nationalized their oil company, invested nothing in it for so many years and mooched of it for so long that their oil production dropped year over year. In their previous Soviet-style system, Venezuelans had cushy government jobs and they only had to go to their nearby government-run shop to buy highly subsidized goods including things like TVs. Now those same shops are empty, there are long lines whenever a truck comes for re-supply, there have been a few food riots and their economy is seeing hyperinflation similar to the Zimbabwean Pound necessitating their need to constantly demonetize their currency.

Around 15 years ago, Tunku Vardarajan wrote an insightful article in the Wall Street Journal where he reflected on his then-recent trip to Venezuela. He had landed in Caracas, the airport security took him to a back office, pointed their guns at him, and demanded US Dollars. Not even the fact that he was about to meet President Hugo Chavez could extricate him from that situation. In that article, he lamented about Venezuela and wondered what would happen to a nation whose majority citizens do no work but live off the state because of its oil wealth. Well, now we know.

Originally Posted by ashokrajagopal

If we are not done with the "Doctor" who charges "260" now ( from earlier 200) to cover his tax --
Isnt it very obvious that in 1-2 years his business will be busted by IT ?
He dint pay tax till now, starts paying tax from tomorrow, he is meat for IT raids.

You are right, I do not understand the logic. Plain and simple fact is the doctor priced his services based on the market and his competition and it was purely his avarice that led him to evade taxes.

I visited my dentist today to find that he has started accepting PayTM and NEFT, he said patients dropped 20% last month, but his rates are the same as before.

[avira_tk]

I don't know how people compare the Venezuelan mess with what is happening here, that country abandoned market economics for steal-and-buy- votes, resulting in out of control inflation and a worthless currency. The 100 denomination taken out of circulation has the value of Re 1. Australia is a first world economy and their HDI rank is 2, supporters on this thread will go to any extent after deciding to suspend disbelief. Venezuelan women are selling hair to pay for food, yes, so much in common with Australia. India's HDI is at 130 and a little better than sub Saharan Africa, mostly because certain states do the heavy lifting. You can imagine the reach of the banking system for those without transport.

The note that is in circulation through ATMs is higher than both the withdrawn denominations, so HDN itself it not being done away with, but be sure to sign up for an e-wallet, where there is no network and keep a credit card handy when the payments system is down for hours on end.

[sukhoi30]

Originally Posted by nowwhat?

Banks seem to be making hay while the sun shines. Both times I went to Axis Bank, their Relationship Manager tried to sell me some product or the other which I refused. When my wife went, she came back wanting to buy a Max Life endowment policy until I put an end to it.

Well, private banks always used to do that. Even before demonetization, when I went to the bank for some menial work, they tried to sell me some or the other product. Can't blame them as they have some targets. But if they link their services (like withdrawal of cash) to buying some or the other services, then it is real bad.

[sourabhzen]

Originally Posted by joslicx

Who is stopping that???

Cashless pocket is stopping that. I had to give most of the cash to the maid and cleaning guy early this month. Now I am carrying a cheque every day to bank to take out some cash but I can not gather enough guts to withdraw money after looking those long ques. Sooner or later I will have no cash at all and then I will have no choice but to stand in the line for hours to take out some money.

[Nav-i-gator]

Originally Posted by sourabhzen

Cashless pocket is stopping that. I had to give most of the cash to the maid and cleaning guy early this month. Now I am carrying a cheque every day to bank to take out some cash but I can not gather enough guts to withdraw money after looking those long ques. Sooner or later I will have no cash at all and then I will have no choice but to stand in the line for hours to take out some money.

It doesn't take more than 1 hour to stand in line at an ATM and get the money. I did that twice since this demonetization happened (took 45 minutes both the times, close to what we spend at airport check in or immigration counters, or a passport office line. Try and visit reservation counters at railway stations if lines at ATM scare you ). In total, 10000 cash and I never felt out of cash. Anyways I try not to carry much cash, prefer card payments, so no issues. Cash is only for backup, when every other mode of payment fail. Never happened so far to me.

[nowwhat?]

Originally Posted by sukhoi30

Well, private banks always used to do that. Even before demonetization, when I went to the bank for some menial work, they tried to sell me some or the other product. Can't blame them as they have some targets. But if they link their services (like withdrawal of cash) to buying some or the other services, then it is real bad.

No link between the two and there was not much pressure, except now they have a captive audience of customers who never visited their bank.

However it did remind me of StanChart in Bangalore where there was this one lady at the NRI desk who tried very hard to sell us something for an hour or two every time we went to access our locker until I closed my account solely to avoid meeting her. My brother-in-law is with the Merchant Navy, he used to leave his ATM card with his Dad before venturing out to sea and the few times his Dad withdrew cash from an ATM, his Dad would get a call from the same lady asking if my brother-in-law was back.

My wife had gone to deposit a single ₹1,000 currency note, the Relationship Manager took her note and gave change in ₹100 notes without making a deposit. Solely for that reason she felt she was under some obligation to buy a ₹3.5 lakh endowment policy which would have netted Axis Bank a cool 25-35% commission in the first year and 5-7.5% commission for the next 14 years.

[joslicx]

Originally Posted by sourabhzen

Cashless pocket is stopping that. I had to give most of the cash to the maid and cleaning guy early this month. Now I am carrying a cheque every day to bank to take out some cash but I can not gather enough guts to withdraw money after looking those long ques. Sooner or later I will have no cash at all and then I will have no choice but to stand in the line for hours to take out some money.

It's just temporary inconvenience. It's not like all cash has been totally banned. Things will get back to normal very soon. Maybe you can try to change your buying patterns a bit for sometime till you get cash. Buy online whatever you can. To tell you about myself, I have only spent 80 rupees in cash since 8th last month. It's not an impossible ask really.

[sourabhzen]

Originally Posted by Nav-i-gator

It doesn't take more than 1 hour to stand in line at an ATM and get the money. I did that twice since this demonetization happened (took 45 minutes both the times, close to what we spend at airport check in or immigration counters, or a passport office line. Try and visit reservation counters at railway stations if lines at ATM scare you ). In total, 10000 cash and I never felt out of cash. Anyways I try not to carry much cash, prefer card payments, so no issues. Cash is only for backup, when every other mode of payment fail. Never happened so far to me.

Yes, I will stand for hour whenever it is absolutely unavoidable. I do not enjoy wasting time in standing in lines like others do. I would rather spend that time with my family or do something productive in my office. I have max 500 in my pocket at any given point of time as I believe in digital transaction. However, I hated it when I had to wait for 20 minutes to pay restaurant bill because of connectivity issue. Again, these all are personal viewpoints, some are liking it but I am completely frustrated by this harassment.

@joslicx - I have spent more than 10k in cash just to pay maid and other people like parking guys, cleaning guys etc. Here in Gurgaon the parking in a mall may cost you more than 80 at once and they do not take cards. Believe me, for past 8-10 years, I have never used cash if the card payment option is available. And yes, I am not liking this temporary inconvenience at all.

[poloman]

People are confusing the bigger picture with personal one.The message being sent is every one is standing every day in queues. There may be some guys who deposit in current accounts every day. But they may be given separate window for that. Take case of an average Joe with a savings account. Suppose that person makes two trips to bank to withdraw 48K a month. He may have spent 2 hours in the queue. That time a person is spending every day in traffic jams in cities like Delhi and Bangalore. So that is not accounted in the big productivity loss figures circulated by experts.


People are not even trying out the 2K notes assuming there is no change available. I got change for 2K from an autowallah and my wife and her friend got change for 4K from a BMTC conductor. People need to stop hoarding cash for the doomsday and start using it in the normal way. The mentality now is you see an ATM open, just queue up there and take the maximum cash out. Will think about the use case later.

Another bunkum being pushed is that Govt is not allowing me take my hard earned cash as and when I wish. Indians currently have around 90L Crore bank deposits. So one fine day if every one come and seek back their deposit, surely there will be restrictions. Govt is not going to print 90L Crores of hard cash for you in the blink of eye. Cash is just a means to transact not a means to store your wealth.

[DwarkaDelhiWala]

I was pained to watch PG students eating in Gurudwara Langars (not out of religious sentiments) because they have no cash and landlords will accept nothing else. I have all the respect for the Langars (i've myself been to Joshimath Gurudwara Langar in 1979 while on trek to Valley of Flowers).

[msdivy]

Originally Posted by smartcat

Not really. If you transfer Rs. 2000 to your e-wallet, only that Rs. 2000 is at risk (assuming the thief has managed to crack the pattern/pin).

Yes, true. It is limited to amount in e-wallet or the IMPS limit in case of UPI. The point is it will be substantially more than cash in a physical-wallet. A vendor on e-wallet might have a good amount in this balance. Let us hope people guard their mobiles.

close to what we spend at airport check in or immigration counters, or a passport office line. Try and visit reservation counters at railway stations if lines at ATM scare you ).

That time a person is spending every day in traffic jams in cities like Delhi and Bangalore.

Actually, you guys are scaring me. Getting sight of cash is turning out as hard as visiting her abode in Tirumala

and my wife and her friend got change for 4K from a BMTC conductor.

I think they deserve an award for doing the impossible - getting change from BMTC conductor

Originally Posted by poloman

People are confusing the bigger picture with personal one.

What exactly is the big picture and how the current plan is getting us there?

[joslicx]

Originally Posted by sourabhzen

Yes, I will stand for hour whenever it is absolutely unavoidable. I do not enjoy wasting time in standing in lines like others do. I would rather spend that time with my family or do something productive in my office. I have max 500 in my pocket at any given point of time as I believe in digital transaction. However, I hated it when I had to wait for 20 minutes to pay restaurant bill because of connectivity issue. Again, these all are personal viewpoints, some are liking it but I am completely frustrated by this harassment.

Queues were always there, even before demonetization also.
Heres quoting this @wef article:

Long before the current crisis, we found that residents of Delhi spent 6 million hours and Rs. 9.1 crore to obtain cash, while residents of Hyderabad spent 1.7 million hours and Rs 3.2 crore to do the same

And the link to the full article: https://www.weforum.org/agenda/2016/...dy-for-digital

[sgiitk]

I am closely monitoring the amount of cash coming in, vs the total amount of ₹14.5 lakh crores reportedly in circulation. If the surrendered amount reaches this total then the possibilities are frightening. How did it happen, who played the dirty tricks, what is the actual amount in circulation. By all accounts the counterfeits are about 1% at worst.

[mayankk]

Originally Posted by joslicx

Queues were always there, even before demonetization also.
Heres quoting this @wef article:

And the link to the full article: https://www.weforum.org/agenda/2016/...dy-for-digital

This is comparable to the time one has to spend at the ATM in the current climate of "demonetisation"?
We didn't realize that the time spent and the availability of cash is the same as before?