Reserve Bank of India on Sunday urged savers to not hoard money as public anger mounted over the government’s shock decision to withdraw large denomination notes in an attempt to clean up the country’s black economy.
Thousands of people were again standing outside banks across the country trying to change 500 and 1,000 rupee bills the government abolished on Tuesday, in an effort to crack down on corruption.
The banned rupee notes made up more than 80 percent of the currency in circulation, leaving millions of people without cash and threatening to bring much of the cash-driven economy to a halt.
As banks struggled to dispense money, the Reserve Bank of India said small denomination currency notes were available with both the central bank and with other lenders.
People “need not be anxious” and should not hoard bank notes because “cash is available when they need it”, the RBI said in a statement.
Prime Minister Narendra Modi, facing criticism from opposition groups for putting ordinary people into difficulties, promised further steps to rid the country of graft.
“We have taken a key step to help the honest citizens of India defeat the menace of black money,” he said in a speech in western seaside resort of Goa. The decision to demonetize the high value notes was planned in secrecy over the past 10 months, he said.
Modi came to power in 2014 with a mandate to boost economic growth and fight the corruption that taints large parts of India’s political and business life.
So far, despite the rising difficulties people are facing, his crackdown on corruption is supported particularly among the middle-class which want action against the political and business elite for wrongdoing.