Modi's Digital India takes a hit as cash withdrawals reach pre-note ban level

Mumbai: Prime Minister Narendra Modi's dream of a Digital India has taken a hit with demand for cash at automated teller machines has risen by manifold. Many ATMs are putting on their display a 'no cash sign' that speaks volumes about cash crunch.

According to a report in The Times of India, cash withdrawals at ATMs have reached pre-demonetisation level, but, astonishingly, supply of currency from banks to ATMs is 50 per cent of pre-November 8 levels.

Recent development is causing inconvenience to customers and has impacted revenue of automated teller machine operators.

"Interbank ATM withdrawals topped Rs 1 lakh crore in March, almost equal to the level in October last year and double the amount in December," TOI quoted data from National Payments Corporation of India.

Presently, Hitachi Payment Services handles as many as 50,000 ATMs in country. India has a total of 2,20,000 ATMs all across the country. Loney Antony, managing director at HPS, says individual cash withdrawal limit has gone up to Rs 4,000 which according to him is pre-demonetisation level.

November 8 note ban sucked out 86 per cent of total currency in circulation in banking system that caused severe cash crunch and landed people in long unending queues at ATMs and banks.

The report added that between November last year and February this year, individual cash withdrawal stood at Rs 2,000. Before November 8, banks' cash supply to ATMs was an average Rs 12 lakh per booth, but this has now dropped to Rs 6 lakh, the report said.