LOL Reasoning to Bank Officers for Deposit of old notes

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More pain for public as many banks refuse to accept deposits above Rs 5k

FM's Assurance Cuts No Ice As Bankers Want Written Orders

The public, already reeli ng under the pain of de monetisation, was put to further hardship on Tuesday by the Reserve Bank of In dia's circular on the previous day that deposits above Rs 5,000 in old 500 and 1,000 notes would be credited to accounts “only after questioning the tenderer, on record, in the presence of at least two officials of the bank as to why this could not be deposited earlier and receiving a satisfactory explanation“.

There were reports from across the country of bank branch officials refusing to accept deposits in excess of Rs 5,000. A top official at a very large government bank acknowledged that instructions had gone out not to accept such deposits unless two officers were present. Officers at some other banks were told by their bosses that they should be completely “satisfied“ before crediting the money--prompting most of them to err on the side of caution.

Idon't want to take a risk and later be questioned or investigated for having accepted more than Rs 5,000. `Satisfaction' is a subjective term,“ said a bank manager.

Several bank officials pointed out that branches outside cities and big towns often have just one officer, the manager, while the rest are clerical staff.“Where's the question of having two officers present?“ said one of them.

Finance minister Arun Jaitley's assurance late on Monday that “no questions will be asked for any amount of old currency that is deposited in one go“ seems to have cut little ice with bank officials, who wanted to see instructions in writing.“The RBI circular and government notification are very clear about the protocol to be followed and there's been no amendment since. The FM may have said something, but we haven't got anything on paper,“ said bank oficials on Tuesday , explaining why they were not accepting deposits above Rs 5,000 in old notes unquestioningly .

Depositors wanted to know why the government had changed its mind about the amount and the rules after initially giving the public till December 30 to deposit any amount. Suddhojit Mitra of Bengali Colony , Burari, seemed to sum things up when he said in exasperation, “I must find ways to deposit my money , and quickly, before they make a new rule.“

The banks had their own problems. Some were confused about what to do, some didn't have the manpower to provide two officials to question the customer, and yet others believed they didn't have the expertise to judge a depositor's answers.“We are not experts at digging out details about whether the source of money is legal or illegal.If the customer is caught at a later date for illegal sources of money , would we be held responsible?“ one banker in Indore asked on condition of anonymity .

Private bankers in Delhi said a few branches did not accept deposits of Rs 5,000 and above in demonetised notes due to the lack of clarity . They said statements from the FM and the RBI circular had created uncertainty and bankers were awaiting clarification. “The uncertainty has to end,“ said a banker who did not wish to be identified.

A person who visited a private bank's branch at Fort, in Mumbai, to deposit his cash faced a volley of questions and demands for several documents.“One was neither prepared for the questions nor for the documents that were being sought.Also, there was a huge rush at the banks, resulting in several minor quarrels between depositors and bank officials. Deposi ting the money was not hasslefree. There seems to be a huge communication gap between the RBI and the banks,“ a customer said on condition of anonymity .

Several banks in Chennai told customers to not deposit more than Rs 5,000 into their accounts and many posted notices to this effect outside their branches.“The government told us not to rush, so we didn't. We thought we had time till December 30 to exchange and deposit notes. On November 22, they stopped exchanges. And on December 19, they are asking us why we delayed,“ said Sujatha Anand, an HDFC Bank customer.

Kolkata was no different.“This (the order) has affected normal operations. Fewer people were deployed for withdrawal due to this additional responsibility and, though we had enough money , withdrawals took much longer,“ said a public sector bank official in South Kolkata.

Saud, a Lucknow resident, faced problems. “Those going to deposit Rs 5,000 have been told by bank officials to deposit the amount in three instalments of Rs 2,000, Rs 2,000 and Rs 1,000, respectively ,“ Saud said. He added that bank officials also told him to submit an application in this regard but when he did so, they did not accept it. Standing in a queue awaiting his turn to withdraw Rs 2,000 from an ATM in Ahmedabad, Deepak Trivedi, 52, who works in a pharmaceutical company , conceded he was completed frustrated with the ever-changing policies of the government. “It's changing its policies almost every second day ,“ said an angry Trivedi. He said middle class people like him have ended up suffering the most.

In Bengaluru, the new directive marked the return of serpentine queues before banks.People who flocked to their banks to deposit demonetised currency on Tuesday ended up engaging in verbal duels with bank staff.

Shailaja, in a queue at the Malleswaram branch of Karnataka Bank, said: “We were told we could deposit up to Rs 2.5 lakh before December 30. Now they are saying we can deposit only Rs 5,000 before December 30. What are we supposed to do with the remaining money that we have saved?“ An SBI manager said: “People keep cursing us for the rules.We try to explain that we are only following orders, but they keep losing patience.“

 

Times View:

The finance minister surely could not have believed that bank managers would go against a circular issued by the RBI merely on the basis of something he said to a news agency. And yet, the government did nothing on Tuesday to get the circular amended.That leaves us with only two possible scenarios. One is that the finance minister was not serious when he said no questions would be asked of those depositing more than Rs 5,000 in old notes if they did so in one go. The other is that he did mean what he said, but did nothing about it. Either way, it raises questions about how seriously we should take announcements made by top functionaries of the government. And that's not a happy state of affairs.

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