Officials said that almost all leading commercial banks made payments to depositors in Indian currency upon the request and urgency shown by the depositors.
In addition, leading banks like NABIL have further lowered the withdrawal limit to Rs 3,500 whereas such limit was reduced to 10,000 from Monday from normal limit of Rs 40,000 for each withdrawal. Other major banks including NIC have also lowered the withdrawal limits for ATMs.
"As per the wish of depositors and increasing demand for cash, some banks have made payments in IC as the banks will remain open just for the next two days before Dashain, Nepal´s biggest festival," said Sashin Joshi, the chairman of Nepal Bankers´ Association (NBA).
According to bankers, an emergency meeting on Tuesday between the officials of NBA and NRB has agreed to allow banks to make part of payments to depositors in IC. As per the understanding, the commercial banks purchased a huge amount of IC from the central bank.
When contacted, a high-ranking NRB official said the central bank has no policy of encouraging financial institutions to pay their deposit liabilities in IC but added that some of the banks might have done so as per the demand of depositors. As per the existing policy, an individual can purchase IC up to Rs 100,000 from commercial banks by submitting an application.
The central bank had received fresh 500-rupee notes worth Rs 4.5 billion last week from a French note printer but the severity of note shortage has not eased even after the release of Rs 3 billion. "Along with huge amount of IC, the central bank released fresh notes worth Rs 20 million on Tuesday to each commercial bank though the demand was over Rs 600 million," said a private banker.
Apart from the delay in delivery of fresh notes from the central bank, central bank officials blamed the mysterious disappearance of high denomination notes worth around Rs 13 billion and higher demand of notes than expected due to higher inflow of remittance for the shortage. "Shrinking inflow of notes to banking system from depositors has aggravated the shortage," he said.
Meanwhile, Finance Minister Surendra Pandey told myrepublica.com that the government has taken the shortage of notes very seriously. "I am in close contact with the central bank officials and I have asked them to do everything possible, including the use of helicopters to transport notes from the areas where there is surplus of notes to deficit areas," he said and added that the current shortage of notes will end in the first week of October after the NRB receives a second consignment of fresh notes worth over Rs 12 billion from the French printer.
prem@myrepublica.com
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