1. Demonetisation drive relief coming, SBI MD says, but may take 10-15 days

Demonetisation drive relief coming, SBI MD says, but may take 10-15 days

Although banks have collected more than Rs 3.25 lakh crore in deposits since the demonetisation drive was announced in the previous week, a substantial amount of outflow from the banking system would soon begin, SBI managing director Rajnish...

By: | Mumbai | Updated: November 16, 2016 8:14 AM
According to Kumar, at present, banks are incurring huge cost on maintaining the 'whole operation' of demonetisation. “We will see how much of it we will be able to use as CASA,” he said, adding that 95% of ATMs of the State Bank Group are up and running. (Representative Image) According to Kumar, at present, banks are incurring huge cost on maintaining the ‘whole operation’ of demonetisation. “We will see how much of it we will be able to use as CASA,” he said, adding that 95% of ATMs of the State Bank Group are up and running. (Representative Image)

Although banks have collected more than Rs 3.25 lakh crore in deposits since the demonetisation drive was announced in the previous week, a substantial amount of outflow from the banking system would soon begin, SBI managing director Rajnish Kumar said on Tuesday.

Kumar said outflow will begin in the next 10-15 days. “Right now, outflow is at 15% of the money being deposited, but it will gradually go up,” he said at an Assocham event here.

“As quickly as it has come in, I have a feeling that it will flow out also very quickly as we need the money for exchange. To that extent, it does not give you much comfort in the sense that this money is available for any long-term funding,” Kumar said.

According to Kumar, at present, banks are incurring huge cost on maintaining the ‘whole operation’ of demonetisation. “We will see how much of it we will be able to use as CASA,” he said, adding that 95% of ATMs of the State Bank Group are up and running.

On using indelible ink to mark borrowers who have exchanged currency notes, Kumar said the bank is in the process of procuring the ink and will start using the same from Wednesday. “There is crowding at many places as people are coming to exchange again and again. So, while using the same ID in a different branch of the same bank gives a pop-up, but when a customer has exchanged in another bank and them comes to SBI it is difficult to know as there is no interoperable system,” Kumar said.

On Monday, the public sector lender said it collected Rs 83,702 crore in deposits since November 10 following the government’s decision to demonetise the existing Rs 500 and Rs 1,000 notes. It had also exchanged Rs 4,146 crore of old notes up to 5 pm on Monday.

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