After the reports of cash crunch in the country created panic, the Reserve Bank of India (RBI) moved into damage control mode and clarified that there is no cash shortage in the country and the printing of currency has been ramped up in all four note presses. “The shortage may be felt in some pockets largely due to logistical issues of replenishing ATMs frequently and the recalibration of ATMs being still underway. RBI is closely monitoring both these aspects,” the central bank said in a statement.
“It is clarified at the outset that there is sufficient cash in the RBI vaults and currency chests,” the RBI said. It also said that “shortage” may be felt in “some pockets” largely due to “logistical issues” of replenishing ATMs frequently and the recalibration of ATMs being still underway.
Earlier in the day, DEA secretary Subhash Chandra Garg said that the RBI will increase five-fold the printing of Rs 500 notes to deal with cash shortages in certain parts of the country, fuelled partly by hoarding of high denomination currency.
Cash shortage has been reported from Andhara Pradesh, Telengana, Karnataka, northern Bihar and certain other parts of the country, apparently on apprehensions about the safety of deposits due to recent spurt in banking frauds. The government said that the main reason for cash shortage felt in some of part of the country was due to unusually high demand for currency.
Garg said that anticipating a spurt in demand the government has given a push to currency printing. “We have taken steps to increase the supply of currency in case demand goes up… The currency printing (will increase) from Rs 500 crore to Rs 2,500 crore per day of Rs 500 note. Finance Minister Arun Jaitley too said that there was adequate cash to deal with any shortage.