[pratyush6]

Originally Posted by msdivy

So far the only action taken by Govt is to create currency crunch. While this has affected anti-social elements (stone pelters, maoists), it has affected legitimate businesses more. I wish & hope Govt has the plan to curb the black economy menace. Otherwise, the game will start with Rs 2000 notes.

The important word is 'So far'. These are measures that will take time to show up. Stone Pelters and Maoists are massive issues as of now. Imagine the coverage media was giving them, painting all of India as a villain ; shows where the vested interests lie of these houses.

Media is so much to be blamed for this. Bad reporting, stoking of fears. They will always show you the worst hit banks - never the ones where its rather quiet as it does not quite create an impact.

I for one, am all in for this. I hope there are many more measures that are undertaken. All Political parties have far too long, in all of our history really taken decision based on vote bank, it's time we thought as a nation. This to me is the first genuine step where a party has gone against it's voters really. It needs to be supported

[Chetan_Rao]

Originally Posted by binand

Sensibility, yes. Education, irrelevant........

The omission of 'formal' before education in my comment was intentional. I only need to look around me every day to realize formal education is but a sorry excuse for knowledge and wisdom.

Originally Posted by poloman

The so called richest, powerful, intellectual, prosperous and advanced country on earth just elected a man many people like you called a clown.......

Totally different context, and just goes to show that humans as a whole are selfish and easily driven by anyone willing to play to their basest fears. They themselves, and the world will bear the consequences of their choice(s). I'll stop my comment here, because it's impossible to continue and keep it non-political, and it's off-topic anyway.

Originally Posted by JLS

.......
However - please look at the other side - leadership does not require qualification and a domain knowledge, rather it requires set of other qualities like - will power, a sense to judge right from wrong, capability to judge situation and act decisively, have courage to stand by the decision, lead set of people.......

Exactly why I said education and sensibility, and like I responded to another member above, I didn't mean formal education. Nobody can be (or is required to be) a know-it-all, and it's perfectly fine to have a basic working knowledge of stuff and leave the minutiae to the experts.

P.S. Comparing the level of debate on other fora and T-BHP, it's heartening to see that we're at least sensible enough to engage in reasoned debate without resorting to heated rhetoric. There will always be contrarian opinion, and it would be a sad & dangerous world where everyone agreed with and followed the majority and nobody questioned why.

P.P.S. Just returned from a vacation to Goa and the 'money exchange for a fee' business is rampant. You swipe your credit card for the amount you want plus the fee amount, and get paid in 500 & 1000 rupee notes that are readily accepted anywhere. Most seasonal places (except large permanent establishments) don't provide a bill or receipt for services rendered so I'm wondering how that cash is going to be accounted for/exchanged as legal earning before the deadline.

[ptushar]

Originally Posted by Sawyer

Admirable indeed, but not to be put on the same level of merit as joining a revolution. And doing this without also doing the truly revolutionary and hard to do things that are the need of the day, isn't going to turn the country around. Which of course no one wants to face up to, because we want to continue to merrily bribe our way out of trouble or pay cash to get a noticeably cheaper deal, or to flout traffic rules when no one is watching, etc etc. We just want everyone else to stop doing so.

Absolutely agree. But this will happen when we think of reducing the people based transactions and move to digital transactions.

Let's take an example. A bit exaggerated, but hey, what can stop a human mind from thinking of the possibilities.

1. All vehicles are RFID tagged in India. All vehicles have a unique identifier linking your mobile phone and your bank account.
2. All vehicles make a mandatory deposit of, say minimum Rs 5000 per year into a special 'Motor owners bank account', which is linked to your RFID tag
3. The bank account pays you an annual interest rate 0.5% more than your regular FD interest, if not used, on a daily accumulation basis paid out monthly
4. There are maximum and minimum limits to the account to ensure that the account is not misused. (E.g. if the maximum limit is Rs. 10,000 then you get interest on only Rs 10,000 even if you keep Rs. 15,000 in the account)
5. For every offense which can be tracked through RFID (e.g. jumping a traffic light, stopping in a no stopping zone, driving above 10% of registered speed limit etc), you get an immediate SMS and the fine is automatically deducted from your account. You get an e-challan on your email ID.
6. You have 60 days to contest the claim at any RTO. If your claim is found to be correct, then you will be refunded the entire amount along with the lost interest

Let's go further.

7. Your RFID tag is also linked to your digital license.
8. For every serious offense, anything from 1 to 3 points are added to your license
9. In case you were not driving the car, you have 30 days to transfer the points from your license to the person's license who was driving at that time. This can be done by online transferring from your account to the person's account and he/she accepting from their online account.

Remove the people based transactions and corruption levels will drop.

Once again - Slightly fictional, but technologically possible.

Originally Posted by msdivy

Last month, I was charged for cash deposit at an SBI branch. The official there told me banks are a planning to charge customers for every bank visit. This doesn't help the cause of getting poor into the banking system. The alternative is online banking (requires a computer) or a smart phone with data plan. Not sure how many can afford this.

Interesting. Citibank has been charging me Rs 100 for every visit to the branch for many years now. Didn't know that SBI is also planning to do this. I think they may do this for a few branches; but it would be counter productive to do this for all branches. Especially rural branches, where the government is trying to get people into the banking system.

But in the long run as the country becomes more technology savvy, this is most likely to happen. Most banks will try and cut costs by reducing their people based transaction channels and getting on more and more digital channels.

Things like Jan Dhan bank accounts, UPI and Rupay are tremendous moves by the government. That is the way to go. And trust me, the future is digital, whether one likes it or not. Payment methods are going to change and how. See whats happening in the world. Sweden will probably be the first cashless country in the world. Today cash transactions account for 2% of all transactions, which is seen to be dropping to 0.5% by 2020. Amazing.

[hothatchaway]

Originally Posted by condor

On another note, payments between entities (incl people) can still be made via non-cash means. Just because cash is sitting in the banks, does not mean that business has to stop. For all the smaller payments, we have the little cash in hand

And this may be an avenue attempted by some to get around the restriction on cash - nothing but simple barter. I have some land which I cannot dispose and need some form of exchange, you have gold coins which I can use in lieu of cash. Problem is, smuggling gold is a crime and very tough. Transferring land in a benami manner to someone with no exchange of cash and stamp duty paid is equally tough

[Zappo]

Originally Posted by SDP

Not going to happen anytime soon, if ever. Hope you understand that this needs an engineer visiting EACH ATM besides software changes and trey/cassette changes.

Don't believe everything that vested interests try to feed people. In an ATM cassette there is little if any in terms of the hardware that need an absolute change if the currency note type changes and thus has rarely a need for an engineer to visit the ATM physically. Only thing remaining there is for the major ATM manufacturers in India (NCR, Diebold and to some extent Nixdorf) to test the lab ATMs with the new 2000 rupees notes to check for expected behaviors like pickup, drop, separation, and various sensors like low cash etc. If any minor adjustment is noted the same will be implemented. Finally the acceptable configuration will be released to the banks. In cases of managed ATMs the same will be also noted by the service providers who will have to implement the configuration changes.

Now the thing to note is that none of these should ideally need any hardware change. The same cassettes will be good to work and more often than not will be remotely configured from the server/application that controls these ATMs. The controlling application can tweak minutest of the behavioral parameters for most ATM parts. These can be implemented through bulk job pushes.

So then where is the catch? Why after almost a week we are still groping in the dark. There are many unsaid lines in this new story which are throwing the characters in this new play in a tizzy.

Most ATMs are managed serviced and even run by 3rd party companies (like Writers, CMS, FSS and more). They have contracts that are almost based on SOPs. They worked fine till date. Now suddenly it does not. Say, I run an ATM for you. My contract with you says that I am responsible for the upkeep, MTBF, cash replenishment, FCI responses etc. Now I know from my experiences what it costs me to maintain this service for the ATM and has signed on a suitable contract. Suddenly you are telling me that there is a one time intervention needed to empty out the cash, deposit it back and file a suitable recon report. This is not accounted for in my contract with you. Multiply it with with the thousands of ATMs and then you suddenly see a sizable one time cost we are talking about. On top of it now you want me to fill the ATMs with 100s and 50s only. That will mean that the ATM that probably needed a replenishment trip every alternate day now empties out every 2-3 hours or so. The cost equation has changed hugely by now. Then of course the long term costs of more frequent break downs etc. are there which though can be baked in when I sign the next contract with you.

Finally, in this heady mix throw in the angle of the unions and their political allegiances that makes them tow different lines. You know what I am hinting at, and there are enough who have reasons to ask the unions to slow down the process.

I guess that tells you where the real challenges are.

[sgiitk]

Originally Posted by pratyush6

Media is so much to be blamed for this. Bad reporting, stoking of fears. They will always show you the worst hit banks - never the ones where its rather quiet as it does not quite create an impact.

I for one, am all in for this. I hope there are many more measures that are undertaken. All Political parties have far too long, in all of our history really taken decision based on vote bank, it's time we thought as a nation. This to me is the first genuine step where a party has gone against it's voters really. It needs to be supported

Two things, we are now learning that media is not to be trusted. Take the supposedly mature scene, US, media was near unanimous that Clinton is winning but Donald Trump won. Also, how were the big us Banks AAA one day and junk the next in the crash.

I am also all for the attack on Black Money. As I posted (I forget where) the GDP will take off and also taxes will have scope for reduction. With 3 lakh crores in the bag, and likely to swell to 6 lakh crores by 30/12. Even if we assume only 60% is from the 'other' economy just imagine the boost in the economy. Some people say the growth rate may cross 10% on this alone.

[indian21r]

Originally Posted by vibbs

Really? Just curious which bank it is?

I added a beneficiary on friday (for the purpose of payment towards new flat purchase) with HDFC Bank. The beneficiary was activated by Sunday for maximum transfer. And I did one transfer (NEFT) on Saturday and one (RTGS) on sunday. All went through smoothly with no hickups whatsoever. Hard to believe that online transfers are suffering and one needs to visit banks to to RTGS.

SBI. Lost half a day today to get the transactions processed.

Manager informed that some services were suspended which is forcing them to do even more manual work

Originally Posted by sukhoi30

Now, tell me, have you ever thought of downloading your banks' app? Ever thought of subscribing to their app services with which you can add beneficiary, do transfer, RTGS/NEFT etc. through the mobile phone app of your bank? Ever checked with your bank if they provide such services through their app.
If you are going to the bank physically to get a beneficiary added at a time when the banks' priorities are different, then I am afraid it is not a good sign.

Why do you think I had to even go to the bank? Because online services are not working.

SBI takes 5 days to make an account active for transfers more than a Lakh. Did I put the limit on it? Nope

To not inconvenience the bank employees who are already overburdened, I went to various SBI group ATM's searching for the option to activate the beneficiary. It did not work. Went to the bank, it did not work there. Finally gave a form to get the transfer done.

My previous post was meant to highlight that business is not as usual. If you choose to read it in a very ignorant manner that is your choice

[sukhoi30]

Originally Posted by Chetan_Rao

P.P.S. Just returned from a vacation to Goa and the 'money exchange for a fee' business is rampant. You swipe your credit card for the amount you want plus the fee amount, and get paid in 500 & 1000 rupee notes that are readily accepted anywhere. Most seasonal places (except large permanent establishments) don't provide a bill or receipt for services rendered so I'm wondering how that cash is going to be accounted for/exchanged as legal earning before the deadline.

I believe this is the right time to put an end to all of this. For long many of us have settled for "no bill" discounts. I have decided that from now on I will not make any payment beyond Rs. 5000/- in cash. I will insist on proper bill and I will also pay any additional charges (Sales tax, VAT added) if they insist? I know I will be paying more for some services or items, but I am willing to take that hit. By doing so, I will ensure that such people comply with the law of the land. Also, this will prevent the spread of black money in future.
When everyone does this, imagine the change we are going to bring about in the society for us and our children.

[SDP]

Originally Posted by Zappo

Don't believe everything that vested interests try to feed people.

In this case, it was the Finance Minister who made the statement.

Source:
http://indianexpress.com/article/ind...ation-4372500/

In an ATM cassette there is little if any in terms of the hardware that need an absolute change if the currency note type changes and thus has rarely a need for an engineer to visit the ATM physically. ...

...The controlling application can tweak minutest of the behavioral parameters for most ATM parts. These can be implemented through bulk job pushes.

...

His exact words were:
it may take up to three weeks for all the 2 lakh ATMs to operate normally. Each one has to be calibrated individually to dispense the new sized notes of Rs 2,000 and Rs 500 besides the lower denomination currency of Rs 100, he said.

[Zappo]

Originally Posted by SDP

In this case, it was the Finance Minister who made the statement.

Source:
http://indianexpress.com/article/ind...ation-4372500/




His exact words were:
it may take up to three weeks for all the 2 lakh ATMs to operate normally. Each one has to be calibrated individually to dispense the new sized notes of Rs 2,000 and Rs 500 besides the lower denomination currency of Rs 100, he said.

Well, let it suffice to say that it is not entirely true. You do not need to calibrate each ATM individually. As in, depending on how you look at it the same statement is correct as well as incorrect. At the end of the day if I have to push a parameter change then it is actually speaking in literal sense calibration of the individual machine. Just that the changes happen as a part of the bulk job push (through something like Gasper by NCR).

[TD_GHY]

Originally Posted by indian21r

SBI. Lost half a day today to get the transactions processed.

Manager informed that some services were suspended which is forcing them to do even more manual work



Why do you think I had to even go to the bank? Because online services are not working.

SBI takes 5 days to make an account active for transfers more than a Lakh. Did I put the limit on it? Nope

To not inconvenience the bank employees who are already overburdened, I went to various SBI group ATM's searching for the option to activate the beneficiary. It did not work. Went to the bank, it did not work there. Finally gave a form to get the transfer done.

My previous post was meant to highlight that business is not as usual. If you choose to read it in a very ignorant manner that is your choice

I added beneficiaries with SBI with the maximum possible limits on Sunday morning at 8.48 and it was activated before 2pm. And I did transactions too. No need to run to the bank with any form. Form was only needed when you need to transfer some amount greater than a prescribed amount immediately (I forgot the amount, will have to check). After four hours, the limit is approved anyway if one adds beneficiaries between 8am-6pm. Don't know why you had to run to the bank and spend half a day.

P.S: I added two. One was intra-bank, other was intra-bank.

[sachinpk]

Originally Posted by diyguy

Instead of the government making money, this has enabled unscrupulous guys into earning off the tax evaders. Such people will obviously go for the option that is least impact to them unless the difference in insignificant.

The government would get their dues from the shop keeper who now has to deposit so much of cash. He would have to show his sales receipts etc. So if he has over priced the item, then the taxes he has to be paid would be on the over priced figure. If he shows a different invoice (with the actual value of the product), he would not be able to explain why the difference in money. I.e as per invoice the sale amount was Rs.10,000 but this chap is bringing in Rs.500 & Rs.1000 notes worth Rs.15,000!

How he handles his reporting is of no concern, the point I was making is there are plenty of avenues to recover from this situation.

That should be a concern; as that is the important part. The shop keeper will be the one who has to pay the tax (and not the black money holder). For the government it does not matter whether A or B pays the taxes, but the taxes should come in.

I also read of the many cell phone purchases being made for resale later.

The assumption is that there would be large number of buyers for these phones. And the person who brought the phone would have to keep it neatly packed, because once the pack is broken many of the products see a drop in their value. It is considered as a "used item". When people are finding less of liquid cash to spare, their buying priorities change. Buying a cell phone using liquid cash may not be the highest one.

All this could have been avoided if there were a forced amnesty scheme at about 55-60% penalty imho...

People did not pay up when a forced amnesty scheme which had 40% tax+penalty. Why should government be even more optimistic and give another plan with 55-60% penalty based amnesty? And you are also not factoring an important aspect of this drive:-
1. Rs.500 & Rs.1000 notes have the maximum counterfeit notes. Allowing them to operate in the market is only going to mess up things. They had to be pulled out of the market. Now irrespective of fake or original Rs.500 & Rs.1000s have to land up at the bank. And one old woman in KL had a very bad surprise when Rs.37,000 she got through Hawala route was all fake. Money gone, and a police case as bonus!
2. Terrorist funding through Hawala channels. This was becoming a major security problem for Indian. Terorrism being an illegal activity, had to rely on illegal ways to get their money. Hawala was that scheme and the transactions were always through cash. As I write this one transport company in Hyderabad is now literally crying as their large hoard of cash is now lying as trash. There were areas where IT dept. and Sales Tax people were scared to go. Now they don't have to go any where; the black money hoarders are coming to the bank (or crying sitting in thier now useless cash piles).

Originally Posted by Ironhide

Jayati Ghosh, in the Hindu.

To be frank, I have stopped subscribing to The Hindu (after reading it for 30+ years) after seeing their bias towards any thing and every thing which the current government does. I stopped it when I realised my subscription pay out, is like paying money to terrorist groups in India. So my comments may NOT be impartial.

It could then start tracking all large sales of likely assets (such as land, houses, gold) and foreign exchange transactions, to follow up with those who had made them.

What consists of a "large sale"? The main problem is that these kind of sales were under-valued, or not shown in the records at all. Then how will government come to know of it? Land prices are shown less, to avoid registration costs. Gold sales may not appear in records at all.

The biggest negative effect is the loss of liquidity for the informal economy, which has already been of massive proportions

It is this informal economy which was also helping counterfeit currency circulation, and terrorist funding using the Hawala route. The maximum amount of counterfeit currency was in Rs.500 an Rs.1000 notes. And did you notice one thing? This article does not mention any thing about the illegal Hawala dealings which was the primary channel used to fund terrorist activities in India. I am sure The Hindu would not even mention this, as their current intentions do not look very India supportive.

Originally Posted by msdivy

What has happened so far is Govt has mopped the currency in circulation and the savings of the people which was held in cash. I believe that 100% of this white and IT cannot claim a single penny as the penalty. Best Govt can get is the tax on the interest paid by the bank on the deposit amount.

Hmm.. Correct me if I understood you wrong. Are you saying that so far the money which was deposited is all white money? And no black money exists in India as liquid currency any where in India??

Sir, from Dec 31st every single Rs.500 & Rs.1000 note you see today are nothing but pieces of paper. There are lots of people who have stock piles of cash which has to be kept that way. Because depositing them in a bank is risky, as the amount there would be cross checked with their "sources of income". The friendly land lord who takes large amounts of advance money (10 months rent in BLR) all want it in cash, why? Because he does not want to show it as income. The flat deals, land purchases all have the values under-quoted and a chunk of the money paid in liquid cash. All these folks who have such cash reserves have now no where to go (other than to a bank). Next in line are the counterfeit currency dealers, who find that their game is up. Please see what happened to a woman in KL with Rs.37,000 worth of currency. And then the biggest hit would be to the hawala dealers who were operating with impunity. Let this excercise get over; I feel we can see lots of "business houses of repute" standing exposed.

Did read this thread for a couple of (last) pages. Many of us seems to have over looked the factors of counterfeit currency, and hawala money; both which are detrimental to the economy (and quite tough to catch).

[heydj]

Media is to blame primarily for the chaos. Reporting exaggerated accounts and things less then true. E.g. Death of old man while in queue, or salt shortages, etc.

But the worst lot is digitally connected people with ample access to plastic creating unnecessary havoc.

India is a huge country stretching from Andaman & Nicobar to Kashmir with 1.2 billion people and few of my fellow Indians expect operational challenges to be resolved within hours, talk about living in fools paradise. Or they think we are living in the future where money will just get beamed to all ATMs at speed of light.

[indian21r]

Originally Posted by TD_GHY

No need to run to the bank with any form. Form was only needed when you need to transfer some amount greater than a prescribed amount immediately (I forgot the amount, will have to check). After four hours, the limit is approved anyway if one adds beneficiaries between 8am-6pm. Don't know why you had to run to the bank and spend half a day.

RTGS does not work immediately with sms activation. As I mentioned limit of Rs 1 lakh over 5 days.

[akhil_007]

Originally Posted by sgiitk

I am also all for the attack on Black Money. As I posted (I forget where) the GDP will take off and also taxes will have scope for reduction. With 3 lakh crores in the bag, and likely to swell to 6 lakh crores by 30/12. Even if we assume only 60% is from the 'other' economy just imagine the boost in the economy. Some people say the growth rate may cross 10% on this alone.

The next question is, will the government pump this money back to the country for various developments(infrastructure, healthcare etc) OR announce some populist schemes to appease the masses?

If they pump it for development, does it translate to development on ground or it will be trickle in the name of development. I hope the politicians dont sweep this money under their carpet. In that case, GDP and Growth Rate will shoot up only on paper