Call it a telling affect of demonetisation, the growth rate of banking sector has fell to its lowest by the end of financial year March 2018. According to data available on the RBI, the rate of bank deposit grew only by 6.7 percent in 2017-18. This is the lowest since 1963 that indicates serious concerns of banking industry.
The non-availability of cash in the ATMs in many states now also indicate a serious consequence of demonetisation. While deposits in banks have come down drastically in recent times, many are taking to alternative routes of investing money in Mutual Funds, real-estate and other savings, investment options.
Although people are not openly stating, they have their own apprehensions over restrictions being imposed on drawing their own money from their accounts in banks. Post demonetisation, people are saving their money in other options than depositing it in their own accounts. This in turn is result of cash crunch in ATMs. While many linked it with Karnataka polls, the fact is also that people who are in dire need of money are not able to draw their own money leaving them run from pillar to post during urgency. Lack of proper planning, estimation are also result of such situation.
Also, the unearthed scams in banking industry from Vijay Mallya to Nirav Modi are estimated at whopping Rs 26,000 Crore. Needless to say that these are costing the faith and trust of people on banks. While Vijay Mallya-Kingfisher bank loan fraud was pegged at Rs 9000 Crore, Nirav Modi-Mehul Choksi-PNB scam is the biggest of all with Rs 12,700 Crore. Rotomac-Vikram Kothari-BoB scam is Rs 3,695 Crore, RP Info System-Shibaji Panja-Canara Bank scam is Rs 515 Crore and the least of all is Simbhaoli Sugars – OBC scam is Rs 109 Crore. The total
Amidst this, the Union Government should take necessary steps to refill faith among people on banks and make sure necessary amount of cash flow.
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