42 Kerala treasuries cashless on salary-pension day

Thousands of people were left standing outside treasuries and banks on the first salary-pension day after the November 8 demonetisation, as 42 state treasuries remained cashless till noon, said a Kerala Minister.

State Finance Minister Thomas Issac told reporters that there was no financial crunch -- rather the crunch was of currency. Despite that, there were no reports of any untoward incident, he said. "Banks do not have the money to disburse. Till now, 42 state treasuries are unable to disburse money as cash did not arrive. We asked for Rs 1,000 crore from RBI to be distributed to banks with Rs 500 crore today (Thursday) and the rest tomorrow (Friday)," said Issac.

There are 157 banking treasuries in the state. While the ATMs have a ceiling of Rs 2,000, the withdrawal limit in treasuries and banks were fixed at Rs 24,000 a week and hence the rush was less at ATMs.

As a matter of abundant caution, additional police force was deployed in front of several banks and treasuries across the state. At Kasargode, due to shortage of currency, many who came to the treasury could get only Rs 10,000 as the available cash was much less than what was required. Issac also slammed Prime Minister Narendra Modi for the ban on high value currency that created a cash crisis across the country.

Issac cited a report of the Centre for Monitoring of Indian Economy that has observed that the total cost of the demonetisation exercise will cost the exchequer Rs 128,000 lakh crore.

"It includes the collection of old notes, printing and distribution of new currency and the opportunity cost. When you look at what was the gain –it is more or less around the cost incurred,” asked Issac.