Finding cash in ATMs has become a task, with a number of ATMs running out of money across the country. People have been seen lining up outside those ATMs which still have money in them, with a sense of deja-vu being witnessed.
While the government has stated that an unexpected increase in demand for currency has resulted in a temporary shortage of money in some areas, the RBI has stated that this lack of money is due to the machines not refilled adequately. The RBI has also indicated that the inability of certain machines to accept the new currency notes is also contributing to the current situation.
Government officials have stated that there are sufficient currency notes to meet the demand, with the currency chests of RBI having the required amount of money.
In a bid to quell this shortage, the government has stepped up the printing of Rs.500 notes, with a five-fold increase in production. This is likely to result in an additional supply of Rs.2,500 crore in Rs.500 denominations each day, with around Rs.70,000 crore to be supplied in a month.
A report by the finance ministry stated that the currency demand during the first thirteen days of April was Rs.45,000 crore, with states like Madhya Pradesh, Bihar, Karnataka, and Andhra Pradesh registering an unusual increase in demand for cash.
The typical cash supply has been around Rs.20,000 crore per month.
Officials have stated that there is no need to panic, for there is printed currency worth Rs.2 lakh crore which is available to be circulated, with the amount in circulation currently being Rs.18.3 lakh crore.
A few experts attributed the shortage due to upcoming elections in Karnataka, while others stated that the demand for money following the harvest season might have contributed to the shortage.
Read more: ATMs to dispense Rs.200 notes soon.