Wednesday, 9 November 2016

PM Narender Modi’s ‘Masterstroke’ Cash Ban to 500 and 1000 Rupee Currency

It is Tuesday, 8th Nov. 2016; Indian Prime Minister Narender Modi did a historical announcement of ban of currency on LIVE television. It included Rs. 500 and Rs. 1000 notes which affected 86% of the current currency in total. Cash is no longer the king now. India is a nation where 98% of the consumer payments are done in cash and 500/1000 rupee note play a major role in these transactions.

Read what the actions are taken in real:
  • Rs. 500 and 1000 note are banned from midnight of the date.
  • Banks and post offices will remain closed on 9th Nov. 2016 and the next day people can start returning the related currency in banks/post offices till 30th Dec. 2016-11-09
  • ATM’s will also not work for 9th and 10th of Nov. Afterwards people can withdraw Rs. 2000/- in a day. This limit will be increased slowly as per the availability of new notes.
  • New currency will be launched soon which include new 500 and 2000 rupee note.

PM Modi is believed one of the strongest politician and this action displays a better face of an honest politician. But it hit many of us as we somehow depend on the electrical money even for the short affairs of transactions and make use of ATMs to the full extent.

But now for more than a month, this will not be convenient. ATM machine will now hold only one-fifth of their current capacity. Also, the transaction time would rise. Real estate industry will also get affected for some time. This will also reduce the total currency circulation in the economy thus creating a situation of deflation. But this will be temporary.

In fact, the decision to remove high-denomination notes is positive for the economy in the medium term. This is one of the systematic approaches of Indian government to remove black money. It will also remove the fake currency circulating in the country in the form of 500 and 1000 rupee note. All the unnoticed money will light up instantaneously in bank accounts.

Secondly, it was a brilliant move by Indian Govt. to announce the news late in the night. Banks was closed, offices were closed and almost all the business activities was closed by this time which didn’t left any chance for scandalous people to channelize their money to the innocent people who are unaware of the move. As the banks are being closed for two days, it will also not let the people shuffle their illegal money.

The step is not taken just in days; actually, it was kept confidential to prevent the illegal financial transactions. Removing big currency is the first step against the illegal transaction of money in the country. Such actions restore the faith of people and help to strengthen the economy of any country and to sum up, it will give currency collectors to add a new note to their collection.

This drastic change is for good and the execution is appreciable and must be welcomed by us. It should be treated as the silver bullet in accordance with the govt. policies to fight Black Money.
Request to all:  Do not exchange 500/1000 rupee note with local/ small vendors if they are unaware of the fact. It might be possible, they do not have any bank account and it will be a complete loss to them.

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