Inconvenience Causes by Redundancy of 500 and 1000 Currency Notes and its Benefits

Citizen of India is facing a lot of inconveniences due to discontinuation of currency notes of Rs 500 and Rs 1000. Being a currency not of higher denomination it is causing greater inconveniences that were caused by such economic and political measures taken for coins of lower denominations like 5 paisa, 10 paisa, 20, paisa, 25 paisa and 50 paisa. It should be noted that Re 1 (Re) is used only for 1) otherwise Rs or ` (Re1=100 paisa).
Currency notes of 500 and 2000 issued by RBI, India
Currency notes of 500 and 2000 issued by RBI, India

Why Inconveniences due to Change in Currency

Most of the household had kept saving in their home in the form of 500 and 1000 currency notes. For trading in cash of larger amount you traders used to use currency of Rs500 and Rs1000. Indian have a habit of spending in a large number of festivals which are celebrated throughout the year. They need money mostly cash for such purchases.
Many shops do not use point of Sale machines issues by banks and other service providers like Paytm and PayUMoney. So people has to use cash for such transactions.
In India there is bad custom of dowry which is widespread and prevalent. This is a season of marriages and many families are facing cash crunches due to the discontinuation of old Rs500 and Rs100 currency notes.
But there is a ray of hope for bride family as they can submit a form to Collector or District Magistrate to get approval for cash withdrawal of Rs 5 lakh in cash from banks. This information is less circulated and many families are unaware about this provision. 
Those who gets Rs 2000 new currency note then they face a lot of problem in getting changes as the available lower denomination currency of 5, 10, 20, 50, 10 and some 500 are insufficient. 

Malpractices in Market and by Retailers

Many retailers are taking extra money in exchange of Rs 500 and Rs1000. Some of shops near our residence they are taking Rs 100 extra on giving change for Rs500 and Rs 150 on giving change for Rs 1000 old currency notes. Even though all banks are changing the currency and allowing the deposit of the old currency notes in bank branches but you will be amazed to see the long queue in from of banks and ATM. People are waiting in long queue as if the government has allowed citizen to withdraw free money distributed by government. Even after a week of the announcement of the changes in currency the state of affairs has not changed. Government has given deadline for December 30th 2016 for deposit of the old currency of 500 and 1000 and take cash from bank. There is a cap on the limit of the cash that any person can take from bank. That’s many people are forced to fall prey for the malpractices prevalent in market for getting change of currency.

Ray of Hope for Economy

The measures taken by government will give good results in long terms and this is possible due to this strict measure taken by government to discontinue the currency notes of 500 and 1000.
Banks will have larger amount of deposits and this will boost the economic development as more funds will be available for the investment in the development projects. The prices of the commodity will fall and but there will be rise in prices of Gold and silver and government has allowed purchase of gold from the old currency notes.
The citizen will learn to use electronic media of fund transfer and purchase of goods and services using ATM, debit card and credit card will be promoted at larger scale as it is a demand driven development. Online payment gateways will prove to be good medium of serving masses.
Online sales and purchase will boom this will help in long awaited dream of government to make India go digital.  
The prevalence of the forged/fake currency notes of higher denomination has been done away with in a single master stoke of the PM Narendra Modi. If you see some news clippings that people are burning currency notes of 500 or 1000 then straight away think that they are destroying black money or fake currency notes. As the original old notes can be exchanged or deposited without any fear.
The dream of digital India will come true sooner than expected.
This measure will surely eradicate smaller black money holder as the large amount of the black money holders who have accounts in foreign banks, their money will get white without any effort and harassment which general public is facing.
It is irony that who has not dearth of Money like Mr Rahul Gandhi was shown standing in queue for withdrawing money which is nothing but mockery of the plights of the general public.
A news showed CM Arvind Kejriwal burning Currency of higher denomination which is a form of protest but not a patriotic act. Such acts in the name of opposition should never be considered good.
Some news clippings on TV channels showed that some Bhartiya Janta Party (BJP) leaders has prior information about the changes in the government policy about currency if that news is true then that must be condemned.

Conclusions

After all, the measures taken by government for curbing the menace of black money and forged currency proved to be good and it is showing results slowly. Some inconveniences is being faced by many person but this will be short term and citizen should keep patience and wait for the good results that these measures will bring to our economy.

Shashikant Nishant Sharma
Policy Analyst and Planning Consultant


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About Editor SNSharma

Author, Planning and Publishing Consultant
http://www.pen2print.org/