Ban on Rs 500, Rs 1,000: Bank Probationary Officers clueless day after Modi’s strike on Black Money

After Prime Minister’s decision to curb the black money worth $94.76 Billion dollars circulating in the economy, 500 and 1000-rupee note have ceased to be a legal tender post-November 9, 2016. The Central Government’s notification on its move to scrap the denomination has been the only source of information not just for the public but also for bank officials.

“The decision to scrap the denominations came as a surprise to us. Our bank will remain closed on November 9, 10, 2016, for all general transactions. We are still awaiting a further plan of action from RBI. People who have a lot of cash, legally earned, will deposit it in the bank and hence we expect a lot of inflow of cash in the coming days,” said Rahul Sahai, a Bank Probationary officer in a Public Sector Bank.

Apart from depositing the cash in your account, you can also exchange your 500 and 1,000 rupee note in a bank branch or at any  Post Office for notes of a lower denomination. The limit for this transaction has been set for Rs 4000 from November 10 to December 30, 2016.

“We have restocked the Branch ATM with notes of a lower denomination and have set the maximum withdrawal limit of Rs 2000. We are still awaiting specific guidelines from RBI. We will resume cash transactions from November 11, 2016, as directed by the RBI. We expect the work load to surge tremendously in the coming week,” said Ashok Kadam, an Assistant Manager in a Private Bank.

“Anticipating rush and panic at the bank counters, we plan to coordinate with the local police to avoid any mishap in the bank. We will also report any unusual transaction to the Financial Intelligence Unit and the Tax authorities for scrutiny,” said Mahendra Sharma, an official of the Oriental Bank of Commerce.

With the new limits on ATM withdrawals being restricted to Rs 2,000 per day, withdrawals from bank accounts limited to Rs 10,000 a day and Rs 20,000 a week, banks may see a general increase in the online transactions. It remains to be seen whether banks reduce the transaction charges (ATM transaction cost, e-transaction cost) in the coming days.