Chennai: Pawn brokers, small financiers hit hard

Chennai: Post-demonetisation, pawn brokers, big and small-time financiers in Chennai and elsewhere in the state known for lending huge cash for people are spending sleepless nights since last week.

They are worried about exchanging huge cash reserves that they have and also about the future of their lending business. On Monday, bookmakers visiting the Madras Race Club (MRC) at Guindy also stayed away from betting due to lack of valid currencies.

Sources with the MRC said that he annual winter season started with the Tote betting, with no activities from bookies. Bookies have decided to meet on November 23, to decide on the next course of action, sources added.

Meanwhile with banks not operating the lockers for the past few days, pawnbrokers are finding it difficult to return the mortgaged jewels to their customers. When DC visited pawnbrokers and financiers in Sowcarpet, Vepery, Chintadripet and Tambaram, most of them vented their anger against the Centre’s move and chose to steam within seeking anonymity.

“I am pleading with the borrowers to wait for one more week to return their mortgaged jewels, as the banks and private facilitators are now hesitant to open the locker chest due to the busy money exchange and cash withdrawals,” explained S. Nithin, a pawn broker in West Tambaram.

“The situation is such that the money flow and business had completely crippled and hire purchase association members have suffered huge loss by investing in vehicle stocks,” said Mukesh Dugar, member, Tamil Nadu Hire Purchase Association.

“Customers without bank accounts or those who cannot avail bank loans depend on us to purchase new vehicles. With the Reserve Bank and the income tax imposing stringent measures we are turning away  customers visiting our showrooms,” he said.

A regular financier in Central Chennai will easily sell around 50 to 60 two-wheelers in a month through the hire purchase agreement. Under this scenario, we would be glad if we could sell 10 vehicles, a month, he rued.

“Most of us feel like being left in lurch and are finding it difficult to get currencies of lesser denominations. Further, cheque bounces are now a common factor among my customers due to insufficient funds. I am extending the EMI dates of all my customers”, said Ramesh Jain, a pawnbroker in Choolai.

A few more ATMs open, lines still long

Though a few more banks operationalised their ATMs after required recalibration, the queues to get “valid” notes on their hands were unending even as people descended at the branches for the sixth consecutive day to exchange or deposit demonetised notes of Rs 500 and Rs 1000.

The functional ATMs are expected to dispense new Rs 500 and Rs 2,000 notes in the city in the coming days and recalibration work on these machines are on full swing.

Several banks had deployed additional staff on Monday as well to help customers in filling the exchange forms and deposit their cash without any difficulty.

As some ATMs began dispensing Rs 2,500 as withdrawal limit instead of the Rs 2,000 that was announced earlier, those lucky expressed happiness.

Sources in several banks said the number of functional ATMs would be increased gradually as banks recalibrate the machines and get required cash from the Reserve Bank of India.