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Demonetisation fallout: In Bihar’s Vaishali, traders allege banks refusing to accept coins

Banks are unofficially refusing to entertain coins, citing paucity of storage space, manpower and machinery to count them. This has had a cascading effect on traders refusing to accept them from customers, leading to a police complaint in Vaishali district of Bihar.

india Updated: Jun 15, 2017 12:51 IST
Rajesh Kumar Thakur
Rajesh Kumar Thakur
Hindustan Times
coins,legal tender,traders
Youths outside Mahua police station in Bihar’s Vaishali district after lodging complaint against a trader for not accepting coins of small denomination. (HT photo)

Post demonetisation, traders are not inclined to entertain coins in small denominations of 1, 2, 5 and 10 rupees.

Their anathema towards coins is largely because banks are indirectly refusing to accept them, citing paucity of storage space, manpower and machinery to count them. The banks, however, are careful not to decline any customer in writing. For, not accepting a legal tender is a crime, which can land one in trouble.

On Monday, police in Vaishali district of north Bihar received a joint complaint from at least eight customers, stating that shopkeepers in Mahua block, 65 kms north of Patna, were not accepting coins of small denomination.

The complainants also enclosed one such denial in writing from a businessman of Sudha milk parlour at primary health centre, Mahua. Hindustan Times has copies of the police complaint and the bizman’s refusal to accept coins of Rs 2 denomination.

“We have received a complaint on traders’ refusal to accept coins. We will verify it before initiating any action,” Vaishali superintendent of police Rakesh Kumar told HT.

The coin problem is not confined to small-time traders alone. Leading businessmen are also facing the same problem. (HT photo)

The coin problem is not confined to small-time traders alone. Leading businessman of Vaishali, KK Boobna, also faces the same problem.

“I have over Rs 3 lakh in coins of Rs 10 denomination, collected in course of trade over months. Banks don’t accept them and neither do businessmen. As a result, it’s dead currency for me because I don’t even earn interest on them. Besides, they weigh heavy and also occupy space,” said Boobna.

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After demonetisation, bankers, on condition of anonymity, claim they have had to make space for old currency and have hardly any space to accommodate coins. Besides, most banks do not have sufficient manpower to physically count coins, which traders bring in thousands of varying denomination.

Vaishali district magistrate (DM) Rachana Patil on Sunday asked Anjani Kishore Sharan, manager of district lead bank — the Central Bank of India — to look into the problem.

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“It is a cognizable offence to not accept coins, which are legal tender. Anyone, be it a trader or a banker, can be booked for doing so,” Sharan told HT.

The problem is not confined to Hajipur alone. Lalganj, Mahnar, Jandaha, Sarai blocks and almost all semi-urban pockets in Vaishali district face the same problem, triggered by ‘unofficial’ refusal by banks to accept coins.

First Published: Jun 15, 2017 10:31 IST