Customers queue up at PSBs as private banks refuse, put limits on Rs 2,000 notes exchange

People queued up at branches of SBI, given that the public sector bank is not demanding any information from people for the exchange.

Customers are making a beeline for branches of public sector banks, especially State Bank of India (SBI), to exchange Rs 2,000 notes as private banks are either not accepting deposits of Rs 2,000 currency notes, or are placing limits beyond the Rs 20,000 that the Reserve Bank of India has stipulated as the amount one can deposit or exchange at a time.

At an HDFC Bank branch near Panchsheel Park, New Delhi, for example, account holders were able to exchange currency for the full limit of Rs 20,000 but non-account holders faced a limit of Rs 10,000.

“This is being done to ensure account holders of our own bank are not at a disadvantage if they come late during the day and we run out of Rs 500 currency notes,” a bank official told Moneycontrol.

Maintaining data

Those who did not have accounts in the bank were being handed over a form to fill out their details. “This is being done to ensure we have some proof of those exchanging money with us. Customers already have their KYC (know your customer) details and so there is no issue, but we are taking ID proofs from all others. We need to maintain data in case it is asked for later,” the bank official added.

The RBI had given clear instructions in its policy stating that the exchange of the Rs 2,000 notes over the counter should be provided to the public in the usual manner as provided earlier without insisting on any request slip or ID proof, subject to the limit of Rs 20,000 at a time.

“We are encouraging our customers to deposit the money with us instead of exchanging it and later withdraw it from an ATM,” the HDFC Bank official said.

This has been the trend for all private sector banks, who have been discouraging exchanges and are instead insisting that customers deposit their money.

Meanwhile, people were lining up at branches of SBI, given that the public sector bank is not demanding any information from people for the exchange.

“We have been standing in line for about an hour. This money was given to me after I worked as a daily wager last month. I do not have a bank account and have been waiting to get this exchanged,” said Murli Ram, a daily wage worker from Badaun in Uttar Pradesh. He was waiting at SBI’s Okhla branch.

Most shops too have begun to refuse Rs 2,000 notes, a visit to several markets showed.

A bakery in Connaught Place was found only accepting the Rs 2,000 currency if the bill came to or exceeded the amount. “We were earlier accepting the notes but are now finding a currency crunch to give change. So we are only accepting the Rs 2,000 notes when someone is buying for the amount,” the cashier said.

According to him, the inflow of cash has definitely increased. “The majority of our payments initially came online, via cards or UPI, but now people who have Rs 2,000 currency notes are preferring to pay in cash to get rid of them,” he said.

A small grocery shop in the outer circle of Connaught Place had completely stopped accepting the now withdrawn currency notes.

“No small shop owners are accepting this note, the prime reason being the values people shop for are generally much smaller and getting change is a challenge. Another reason is that we don’t want to stand in long queues at banks to get rid of them,” Dharampal Singh, owner of the shop, said.

Petrol pumps have become another avenue for people to rid themselves of Rs 2,000 notes. However, petrol pumps are continuing to accept it without hassle.

“People are coming in to get petrol filled for Rs 200 and giving us Rs 2,000 notes. Since we do not have a crunch of other currency, we are accepting it,” Akram Khan, a worker at a petrol pump in Connaught Place said.