On November 9, 2016, when journalists approached me as the senior vice president of the All India Bank Officers’ Confederation for a comme...
On November 9, 2016, when journalists approached me as the senior vice president of the All India Bank Officers’ Confederation for a comment regarding the demonetisation announcement by Prime Minister Narendra Modi the previous night, I said we would face the challenge and co-operate with the government to ensure the smooth exchange of currency notes. As a responsible person in this field, that is what was expected of me.
But on November 10, when bank branches opened to allow denotified currency notes to be exchanged for new ones, we were faced with utter chaos. Around the country, there were huge, unmanageable panic-stricken crowds and a dire shortage of currency. The raft of confusing guidelines only made matters worse and paralysed banks.
Upon enquiry, I found that banks had in fact received the new Rs 2,000 notes from the Reserve Bank of India before November 8 but of course no one knew that the drastic step of demonetisation was on the cards. We had been instructed not to open the boxes until the Reserve Bank notified us. This was a bad idea because banks cannot keep currency in their chests without verification.
Perpetuating the confusion
The Reserve Bank and the ministry of economic affairs (of which the...
