Hyderabad: Less money, week to see huge cash crunch

Hyderabad: There’s no good news on the currency front. The crunch is set to worsen further in the city and other urban areas this week as nearly 70 per cent of Rs 1,800 crore supplied by the RBI to Telangana state on Saturday is being disbursed in rural areas, which are facing an even greater shortage of currency.

Banks and ATMs in the city and urban areas have been going dry within an hour or two of opening as people are rushing to withdraw their salaries. Finance officials say the chances of TS getting new cash reserves from the RBI this week are bleak. They expect the RBI to send Rs 2,000 crore next week.

TS has received just Rs 13,000 crore in new currency from the RBI since demonetisation on November 8 against old currency deposits of Rs 45,000 crore made in banks, resulting in a huge demand-supply gap.

The RBI has supplied Rs 13,000 crore to TS in five phases so far, of which 90 per cent is in Rs 2,000 denomination notes. Of this, 70 per cent went to the city and other urban areas and 30 per cent to rural areas.

Since this created shortages in rural areas, the state government requested banks to send 70 per cent cash to rural areas and 30 per cent to urban areas, out of Rs 1,800 crore received in the latest phase on Saturday.

There are 4,000 bank branches in TS, 1,000 of them within GHMC limits. Finance minister Etela Rajender said, “We have sought Rs 5,000 crore but the RBI sent only Rs 1,800 crore which is not sufficient. Rural areas continue to suffer more with severe cash crunch for the past three weeks.”