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Cash crunch: ATMs are running dry across India; government says needs three days to fix problem

FP Staff
Currency stocks should have been adequate for country's average requirements–if Indians had adopted digital transactions at the scale Prime Minister Narendra Modi’s government envisaged after demonetisation

ATMs in several cities across the country, operated by both state-run and private backs, are reportedly running dry. The problem seems to have affected ATMs in cities and towns across Andhra Pradesh, Telangana, Karnataka, Madhya Pradesh, Maharashtra, Rajasthan and Uttar Pradesh, according to media reports.

One reason for this could be that cash withdrawals at some bank branches and their ATMs are much higher than deposit made at those branches.

An email sent to the Reserve Bank of India (RBI), on Tuesday, seeking response on the reported cash shortage remained unanswered when this report was published.

Troubled customers tweeted about the non availability of cash at ATMs.

Communist Party of India member Sitaram Yechury too took to twitter to express his angst.

Govt takes note

Meanwhile, Minister of State (MoS) Finance S P Shukla said, "We've cash currency of Rs 1,25,000 crore right now. There is one problem that some states have less currency and others have more. Government has formed state-wise committee and RBI also formed committee to transfer currency from one state to other. It will be done in three days."

Several states have faced cash shortages despite the fact that currency flows are now at the pre-demonetisation level. A recent analysis by the RBI has found that the rate of cash withdrawal was far more than the cash deposits in banks in states such as Andhra Pradesh, Bihar, Karnataka, Maharashtra, Rajasthan, Uttar Pradesh, Madhya Pradesh, and Telangana, according a report in the Business Standard.

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