Banks have received scrapped notes worth over Rs 5.44 trillion

People have exchanged and deposited over Rs 5.44 lakh crore worth of scrapped Rs 500/1,000 notes at different banks till November 18 following demonetisation of the higher denomination currency. The banks also disbursed Rs 1,03,316 crore over the counter and via ATMs between November 10 and November 18, the Reserve Bank said in a statement. Consequent to the announcement of withdrawal of legal tender status of banknotes of Rs 500 and Rs 1000 denominations from the midnight of November 8, 2016, the RBI had made arrangements for exchange and/or deposit of such notes. The facility was available at the counters of the Reserve Bank and commercial banks, Regional Rural banks and Urban Cooperative Banks.

“Banks have since reported that such exchange/deposits effected from November 10, 2016 up to November 18, 2016 amounted to Rs 5,44,571 crore (exchange amounted to Rs 33,006 crore and deposits amounted to Rs 5,11,565 crore).

“They have also reported that the public have withdrawn, during this period, Rs 1,03,316 crore from their accounts either over the counter or through ATMs,” the statement said. Long queues were witnessed on November 10, the day on which banks opened after after announcement of demonetisation, as people thronged banks and post offices to exchange and deposit invalid currency notes.

People also queued up at ATMs for cash withdrawal. Meanwhile, government made several exceptions allowing people to use invalid currency notes for buying petrol/diesel, rail and air tickets, payment of public utilities, taxes and government hospitals.

On Monday, the government allowed farmers to purchase seeds for the rabi crops using old Rs 500 notes from government outlets or state, central agriculture university.

Meanwhile, with people being compelled to switch to non-cash mode after the demonetisation move, digital payments company Paytm has been witnessing over 7 million transactions worth Rs 120 crore a day, helping it crosss USD 5 billion GMV sales, four months ahead of its target.

Gross Merchandise Value (GMV), which is an industry term for estimating the total worth of goods sold through a digital platform, for Paytm was USD 3 billion last year. The Alibaba-backed company, which offers both mobile payment platform and e-commerce marketplace, said it is now witnessing about 7 million daily transactions worth about Rs 120 crore.

“Paytm is registering over 7 million transactions worth Rs 120 crore in a day as millions of consumers and merchants across the country try mobile payments on the Paytm payment platform for the first time,” Paytm Vice President Sudhanshu Gupta said.

The company is currently doing more transactions than the combined average daily usage of credit and debit cards in India, he added. Mobile wallet companies including Paytm have seen manifold growth in transactions and new users coming on board with people turning to digital platforms as serpentine queues outside ATMs continuing to hassle cash-strapped public.

Paytm has been able to serve over 45 million users in last 10 days alone and over 5 million new users added since the demonetisation drive, Gupta said. “Offline transactions now contribute to over 65 per cent of the overall business from 15 per cent about six months ago.

We are also working on expanding our merchant network by 150,000 additional merchants,” he said. Gupta added that the company has now crossed the overall USD 5 billion GMV milestone.

Over 10 lakh offline merchants across India accept Paytm for payment including taxis, autos, petrol pumps, grocery shops, restaurants, coffee shops, multiplexes, and parking. Paytm has over 150 million mobile wallet users currently.

The company has also waived off its one per cent transaction fee for transferring money to the Bank for KYC-enabled merchants to facilitate this shift towards digital in merchant behavior. 

The RBI on Monday imposed stiff conditions for withdrawal of up to Rs 2.5 lakh in cash from bank accounts for marriages, saying the money can be withdrawn only from the credit balance as on November 8, the day demonetisation was announced. 

While notifying norms, RBI said the cash withdrawn should be used only to make payment to those persons who do not have bank accounts and the names of such recipients should be mentioned while applying for withdrawal of the cash. The application for withdrawal should also provide names of bride and groom, their identify proofs, addresses and date of marriage. 

The amount can be withdrawn only if the date of marriage is on or before December 30, 2016. With a view to enabling people to perform weddings of their wards, it has been decided to allow higher limits of cash withdrawals from their bank deposit accounts to meet wedding-related expenses, RBI said in a notification. 

“A maximum of Rs 2,50,000 is allowed to be withdrawn from bank deposit accounts till December 30, 2016, out of the balances at credit in the account as of close of business on November 8, 2016,” the notification said. “Withdrawals can be made by either of the parents or the person getting married. (Only one of them will be permitted to withdraw).”