When Prime Minister Narendra Modi announced the demonetisation of Rs 500 and Rs 1,000 notes on November 8, he asked the nation to bear the “minor inconvenience” for 50 days. But just over 50 days later, the cash crunch has not eased. Across the country, thousands of Automatic Teller Machines remain dry. While the Reserve Bank of India has allowed a weekly withdrawal of Rs 24,000 per account, banks have set arbitrary limits in branches due to the cash shortage. However, Income Tax department raids across India have resulted in the seizure of crores of rupees in new Rs 500 and Rs 2,000 notes. CH Venkatachalam, general secretary of the All India Bank Employees’ Association, said these raids, and the reluctance of the income tax department to give out proper information about them, have created the impression that bankers are helping black money hoarders. The association, one of the largest unions in India, has planned a nation-wide protest on January 3 demanding a Central Bureau of Investigation probe into illegal cash exchange and compensation for the additional workload they face after demonetisation.
Edited excerpts from an interview with Venkatachalam:
The 50 days deadline given by the prime minister for return of normalcy is over. How is the situation on the ground?
There is hardly any improvement. Branches of nationalised banks across the country are facing severe cash shortage. Many of them had to fix lower withdrawal limits so that more customers could be served. In our estimate, only 40% of over two lakh Automatic Teller Machines are functional and this too for a few hours a day. We do not think this will magically improve after December 30. The Reserve Bank of India has a duty to ensure proper cash supply. As employees, we feel our image has taken a beating as customers think we are hiding cash from them and helping the rich. In reality, nationalised banks are struggling without cash supply.
But why will the employees’ image get dented when it is the RBI and the government that are to be blamed?
This is because of what has come out of raids conducted by the Income Tax department. After these raids, media, based on information from IT officials, has reported that crores of black money in the form of new Rs 2,000 and Rs 500 have been seized. This gives a false perception that bankers are colluding with fraudsters. The customers are turning angry. But let me tell you that the systems have been created in such a way that we will not be able to exchange such large amounts of cash in any branch. Basically, the systems in place in nationalised banks wouldn’t allow it. Our suspicion is that the fault lies with private ATM service providers who are allowed to handle cash. The RBI is saying it is supplying enough cash. But when you go to the ground, you see that a majority of ATMs are dry. How is this possible? Is the cash getting diverted in the middle? We see a big scam here. We demand a thorough CBI probe into this problem so that the real culprits are caught.
But bank employees were also suspended for exchanging cash beyond RBI prescribed limits...
You need to place it in context. What was the amount they exchanged? A few thousand rupees. What is the amount of new currency seized in these raids? They run into hundreds of crores. I am not defending employees who erred. But you should understand that these small violations are being magnified but real culprits are happily getting away with defrauding the public. Let the CBI probe. If people are found doing something illegal, whether employees or otherwise, let them face the music. Why is there a reluctance to probe?
Do you see the cash supply situation improving in the coming days?
We are entering a new month. People will come to the bank to access their salaries and pensions. The increase in cash supply to branches should be significant to overcome this challenge. This is where I think the RBI has not functioned well. They should put out daily figures of how cash has been sent to each branch. They do have the data but they don’t want to release it. Why so? Unions have already raised this doubt. We feel some private banks are getting cash at the cost of nationalised banks. If the RBI puts out the data, we will be able to see where all the cash is going. But above all these issues, we bank employees are hurt. Visit a branch and see for yourself. We have to hear the worst of abuses from our customers. The government shouldn’t forget we are also humans. Every employee has worked overtime over the last 50 days. Many have died due to work pressure. Despite terms of employment that guarantee us extra pay for extra time, we have not been given anything. This cannot work.
How are you going to tackle the question of additional wage?
We have called for a nation-wide protest on January 3 outside all RBI regional offices. The demands include proper cash supply to branches, extra pay and a CBI probe into cash diversion. If things do not improve, we are planning to call for a strike when all unions meet for a conference on January 8. Bankers cannot be a collateral to bad policy implementation.