State Bank Of India: SBI staff at wit’s end over cash crunch: Bank tells RBI

NEW DELHI: The State Bank of India had complained to the Reserve Bank of India last month that it was facing a “chronic” cash shortage and asked for adequate supplies of currency notes to ensure smooth functioning.

In a May 12 letter addressed to the RBI governor, the bank said branch officials were at their “wits’ end” and that the lack of cash was creating a law and order problem, putting the safety of staff at risk. There was no response to SBI’s queries. SBI said in the month-old note that the shortage of currency was severe in states such as Andhra Pradesh, Telangana, Gujarat and Bihar.

The bank attributed the demand for cash to the summer holidays, agricultural operations and the scrapping of withdrawal restrictions. A senior bank executive aware of the correspondence told ET that the bank had raised the issue even earlier with the central bank and suggested that currency supplies still aren’t meeting demand.

“It is not just us, every bank is more or less facing the same crunch. We are trying our best to improve availability of cash by moving available cash around and quick recycling but these efforts are limited,” he said.

Another senior bank executive with a state-run lender also confirmed that his bank has raised similar concerns with RBI in the past. SBI has noted that for April-May period, the issuable cash balance in its currency chests had dropped in 11 out of 14 circles.

Source