India's government blamed reports of a new cash shortage in several states on an "unusual spurt in currency demand" over the last three months. In Telangana and Andhra Pradesh, ATMs have been dry for over a month. "If the situation continues for another week, we fear for the safety of bank employees" in affected states, he said.
Axis Bank said it has enough cash in its ATMs, which is "better than the industry average and there is no such crisis". However, the state-run bank in a report said that India's currency shortfall may be Rs 70,000 crore, which is almost three times the government's estimate. "There should not be any charge for usage of debit cards". Residents of Sitabuldi, Gandhibagh, Itwari, Sadar, Gokulpeth and Medical Square among other places were severely affected as most of the ATMs in the localities were unable to dispense cash.
There have been rumours that the passage of the Financial Resolution and Deposit Insurance (FRDI) Bill will lead to heavy monetary losses for savers if a bank goes bankrupt.
"The ghost of demonetization has come back to haunt the government/RBI".
He added: "I also suspect that RBI seriously miscalculated demand for cash in the post-harvest season". That needs to be increased.
"We believe, there has been a forced shift in currency composition with more of smaller denomination notes in circulation now". "This may have also prompted more withdrawals", it added.
"The recent reports of cash shortage appear intriguing and defy logic".
Kumar said there are certain areas where there is a problem with the running of ATMs and availability of cash of particular denomination.
"There are very few ATMs in Mayur Vihar and most are out of cash". Following the advent of summer, a large number of tourists is likely to visit the hill stations in the coming days and they are bound to land in a precarious position if the situation does not improve, said sources.
Senior finance ministry officials today held video conferences with public sector banks during which they have been asked to replenish ATMs with 500 rupee notes.
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