"Overall, there is more than the adequate currency in circulation and also available with the banks". A report by ANI quoting Rajnish Kumar, Chairman, State Bank of India (SBI) on Tuesday assured the people of the country that the situation of cash crunch is "temporary" and that normalcy will be restored within a week.
Currency with the public excludes cash with banks, while currency in circulation includes notes in circulation, rupee and small coins, and deposits with commercial banks in current and savings accounts. Currency in circulation on 4 November 2016 was Rs17.74 lakh crore. Jaitley has also hinted at an "unusual spurt in demand" for cash as a reason for the problem.
Reports suggest that the various festivals like Baisakhi, Bihu and other harvest festivals might have pushed the demand for cash in the states. "When demonitisation took place, markets were flooded with currency notes worth Rs 15 lakh crore". Tajganj resident Mohammad Saif said, "I have visited 5-6 ATMs since morning". In the next couple of days, we'll have a supply of about 2500 crore of Rs 500 notes per day. "This should give you assurance that we are geared up to meet the rising demand", he said. "It (the shortage) will be solved in 2-3 days", Shukla told PTI.
"In a month, we will be printing about Rs 70,000-Rs 75,000 crore. These notes alone can more than meet the demand of any month", he said. Monetary expert and IIM -Bangalore Prof R Vaidyanathan however, puts a different spin to cash crunch. Cities and towns across Andhra Pradesh, Telangana, Karnataka, Madhya Pradesh, Gujarat, Maharashtra, Bihar, Rajasthan and Uttar Pradesh were among those impacted by the cash crunch.
Several netizens took to Twitter and expressed their disappointment over the issue.
"Sir, with due respect the cash shortage in Banks & ATMs is neither sudden nor temporary". "RBI is closely monitoring both these aspects", the central bank said.
The Manipur government also wrote a letter to the finance ministry apprising them of acute shortage of cash in the state.
Madhya Pradesh Chief Minister Shivraj Singh Chouhan indicated similar fears by alleging that a conspiracy of hoarding Rs 2,000 notes had led to this situation. They are more than adequate to meet the transaction demand of customers...
On the other hand, Minister of State for Finance (MoS) SP Shukla said the problem is purely on a state-basis and those without sufficient cash reserves are facing the issue. Adding, "Where these notes of Rs 2,000 denomination are going, who are keeping them out of circulation?"
"In certain states, the demand has gone up".
There have been some other media reports stating that ATMs in the northern parts of Bihar saw cash shortages due to transportation and logistical issues.