State Bank of India on Wednesday said that the availability of cash at its ATMs had improved in the last 24 hours, even as the bank’s research wing estimated the shortfall in cash in the system at about Rs 70,000 crore, PTI reported. The estimated figure is about a third of monthly withdrawals at ATMs.
The government of Uttar Pradesh said the Reserve Bank of India had made enough cash available with leading banks, and there was no cash crunch in the state. In Bihar, most ATMs continued to run dry, but the government said the situation would become normal soon, PTI reported.
“Main banks like SBI, Bank of Baroda, Union Bank of India, Central Bank, ICICI Bank and HDFC have confirmed availability of enough cash in their currency chests,” a spokesperson for the Uttar Pradesh government said. “There are 19,000 ATMs in the state and strict directives have been issued to ensure availability of cash in them.”
People from several states, including Karnataka, Maharashtra, Andhra Pradesh, Rajasthan, Uttar Pradesh, Madhya Pradesh, Gujarat, Bihar and Telangana have said in recent days that ATMs in their areas either do not have cash or are not functioning.
Banks’ response
State Bank of India’s Deputy Managing Director Neeraj Vyas said that the situation would get back to normal “within soonest possible time”. “Availability of cash in SBI ATMs has improved in the last 24 hours,” he said. “Efforts are being made on a continuous basis to improve the cash availability further in a few geographies.”
Axis Bank said it has enough cash in its ATMs, which is “better than the industry average and there is no such crisis”. “Even if there are cases of ATMs running out of money, it is because people from other banks are coming to withdraw money,” the private lender said.
Punjab National Bank, Bank of India and Canara Bank claimed that shortage of cash at their ATMs was limited to some regions only, and that they were dealing with the situation.
Meanwhile, mobile wallet companies said on Wednesday that digital transactions on their platforms had risen significantly.
RBI’s response unsatisfactory, says Chidambaram
In a series of tweets, former Finance Minister P Chidambaram said the Reserve Bank of India’s statement on Tuesday evening was unsatisfactory. “If RBI has printed and supplied sufficient cash, it must explain why there is a cash shortage,” he said. He said the cash crunch could have happened because people have lost faith in the banking system, and are withdrawing more money than they are depositing.
Finance Minister Arun Jaitley had earlier said that the problem was “temporary” and the result of “sudden and unusual increase” in withdrawals in some parts of the country.
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