Why are ATMs running dry despite record cash reserves in the country? The inside story behind the ‘mysterious’ shortage of currency notes. Why are ATMs running dry despite record cash flow in the country? The inside story behind the ‘mysterious’ shortage of notes – ..

A very surprising puzzle is emerging from the country’s economy and banking system. According to all the claims of the Reserve Bank of India (RBI) and government data, at present the circulation of cash in the country’s market is at its highest ever i.e. record level. But despite this huge cash, the reality on the ground seems to be exactly the opposite. ATMs have suddenly gone dry in many states of the country, especially in small towns and rural areas. People are forced to run from one ATM to another to withdraw their hard-earned money. This contradiction between the figures and the ground reality is surprising everyone.

Where is all the money disappearing and what is the reason for ATMs being empty? When there is no shortage in printing and supply of notes in the country, then why are ‘No Cash’ boards hanging in ATMs? According to banking experts and logistics companies, many big reasons are working together behind this. The first reason is the deteriorating coordination between cash management and ATM refilling companies. During festivals, wedding season or election season, the demand for cash suddenly increases manifold. Apart from this, in order to promote digital transactions, many banks have reduced the frequency of depositing cash in ATMs. Due to some technical glitches and software updates after the merger of banks, money is not reaching the ATM on time.

Have people started depositing more cash in their homes than in banks? Another interesting aspect of this whole story is that even in this era of Digital India, people are considering it safer to keep cash with them. Due to fear of economic uncertainties or fluctuations in interest rates, many people are holding money in the form of liquid cash instead of depositing it in banks or spending it. When money from the market does not return to banks in circulation, the rotation of cash in the banking system slows down. This is the reason why cash on record is visible in the RBI report, but banks have an immediate shortage of cash to put in ATMs.

People of the country entangled in the maze of data and the way forward Banking and economy experts believe that the solution to this problem is not just printing more notes, but their proper distribution. RBI and the government are constantly monitoring the situation and banks are being instructed to ensure the availability of cash in ATMs at all costs. Especially in rural areas where people are still completely dependent on cash, the number of mobile ATMs and cash vans is being increased. Unless the logistics network of banks upgrades itself according to this increased demand, the public may have to face this cash crunch i.e. shortage of notes.