As of now, we can claim banks and its top management have a honey moon period in terms cash deposit. We can expect somewhere between a few lakh crores to few thousand crores of deposit increase in both savings and current accounts nationwide. There would be having a remarkable increase in the market capitalization space also. Banks would be biggest gainer in this measure. Those who hated banking system will be forced to use the banking domain without alternatives.
This cash deposit and market capitalization will help GOI and RBI to calculate nations unaccounted expenditures and unaccounted savings accounted which would indirectly help GOI rate India economic strength powerful and compete with global super powers. The, when we speak about bank employees would be heavily loaded with tons of work to be done. Paperless banking institutions would have less load to their employees, but banks still under paper processing may face heavy tons of paper to be used in the next few days to months. Hence, bank employees and the bank branches may be filled with loads of people in the next forthcoming days till December 10, 2016.
People including the poor people can be soon expected to use smart transactions like online purchase, online fund transfer to satisfy their needs. By this way, we can find many poor Indians using digital technologies to achieve their basic needs. We may soon expect people pay their ration shops or social distribution funds online like LPG subsidy.
We may soon see every Indian using digital tools for their basic finance purposes. Reliance Jio may be one of the beneficiaries of this with the people of India. We can see all telecom companies having new subscribers and a drastic increase in subscriber base in the forthcoming days. Investments in the digital space can be expected to sky rocket at the rates that is unimaginable. Apart from this, people can expect black money free society which is totally uncertain which can be answered only after a few years of NGT migration.
Whether one can accept this truth or not, this is a bitter medicine given by the Government of India to the people of India to dissolve black money issue. People of India will be heavily affected because of this Rs.500 and 1000 Banned suddenly and surprisingly. Anyone who needs to carry Rs 5000 or greater may have to carry loads of Rs. 100 or need to make a cashless transaction because of Rs. 500 and 1000 ban. We are completely unsure whether the government has enough supplies of Rs. 2000 and other new currency notes to circulate to the people of India.
All banks in India are helping people to know the details and to exchange Rs. 500 and Rs. 1000 old currencies into new ones.
We may expect a sudden price rise in few commodities were direct flows take place. For the next few months, people would queue to get low value currencies. Totally, all the lower middle class and the upper middle class will be running here and there to receive their cash needs. The only happiness is that in few hospitals and medical services are expected from this Rs. 500 and 1000 ban for few longer days. All the government hospitals would take old Rs. 500 and 1000 till November 11, 2016 as said by RBI (Reserve Bank of India). The only question amount the messes as to why was this ban issued suddenly without prior notice. We may guess that the government wants to give a surprise treatment to the black money holders. If that is so, we are unsure how much black money is going to be eradicated back to the government treasury back and what are their measures to bring back the foreign black moneys stored in foreign banks. On speaking about the poor class or BPL families, this ban may not affect them much. If a daily wage of Rs 100 to Rs. 500 would receive his amount daily without any issues to some extent.
If there is a cash shortage, the BPL earners may be affected as their payments may be delayed or may be forced to receive their earnings collectively in weekly or monthly salary to adhere to cash flow. Also, if there is price increase in commodities, it would somehow affect the poor people without any questions. On speaking about the elite classes, their black money cannot be utilized in any means and they may face issue with cash flow based business. Apart from this, we may not find any effects to elite classes. So, this bitter medicine is somehow going to affect the middle class and the poverty affected people and the difficulties of rich may be negligible.
As earlier said about fake currency future in India even black money holding is also debatable. Current black money holders if want to make their black money accountable, have to submit source of income, income tax returns and if there are violations have to face consequences. Hence, black money holders can be expected to move black money offshore or invest in smuggling or other unlawful activities to store their fake money in some other currency outside India. When we speak about unlawful activities, people invest black money in many unlawful ways like cash safes in hidden places, drug investments and hawala but all these have to be done before December 10th 2016 to be utilized by them as foreign currency.
We are not sure as to whether Government of India has taken any steps to curb and destroy such activities. Because, all these kinds of curbing activities need heavy integration of intelligence agencies, the armed forces in the sea, air & land and the local police forces to work integrated and have the black money kings to be identified and punitive action to the enforced. As the people we may there be stringent and tough patrolling in the nation in all areas, mainly the land and sea surveillance. All national agencies can be expected to be put on high alert to curb such activities. We don’t know whether we will be seeing government actions on this regard hitting the media screens.
Fake Currencies currently under circulation by fake circulation rackets will not be able to exchange them at banks. We are not sure as to how the banks are going to handle fake currencies during the days between today and December 10, 2016. People may be queuing up banks and post offices to tender their old notes in their savings account or to exchange them as lower currencies of Rs. 10, 100, 20, 50 and coins of Rs. 5, 10.
Apart from this, we are not sure as to whether government has taken necessary actions to destroy fake rackets in the country and internationally or they have decided not to touch or care about old fake currency rackets as new NGT currencies are to be circulated. Fake currency rackets can be expected to keep their tails hidden or tied tight for few days to few months. Maybe in future, we may not know whether there are currency rackets would do harm by circulating fake currency of NGT Currencies.
The Questions surrounding why Rs. 500 and Rs. 1000 is banned by Government of India and How will Rs 500 and 1000 Banned will crub Black Money?
Black Money is circulated majorly using Rs. 500 and 1000 notes in the mess of people. So, the Government of India has been thinking about solving this issue since Indian Independence. But, there were no long term solutions. Hence, Reserve Bank of India (RBI) and Indian Government came up with a solution called NGT (Nano GPS Technology), a GPS tracking technique installed in newly released Rs. 2000 notes. This will help the financial regulator to find black money circulation and fund movement across the country and globe. So, as per the expectations, black money circulation would turn impossible. Also all old currencies like Rs, 500 and 1000, which in use will be scrapped and current black money holders cannot hold any of their old cash as it is unusable after December 10, 2016.
The old currencies of Rs 500 and 1000 has to be either destroyed by black money holders or had to be surrendered to the government of India or has to be converted into foreign currency through hawala, smuggling or other loop holes available as soon as possible to save the black money they hold.
How will Rs 500 and 1000 notes will curb fake Currency after it is banned?
Fake currency currently is circulation by fake currency rackets which cannot be surrendered at banks or banks would deny fake Rs 500 and Rs 1000 notes coming from the messes. Intelligence agencies like IB, RAW, Police and CBI would get a great chance to find fake currency rackets in bulk if there is any fake currency rackets circulation currently trying to be done on or before December 10th 2016. Apart from this, new notes that are to be released soon may not be duplicated so soon as they are released now. Since, the new currency has NGT in it. If, fake currencies are circulated, those currencies can be easily identified based on the location of fake note circulated in huge and the regular fake currency finding activity will be ongoing with these to curb fake currency.
All the banks in India are helping their customers to know the latest news and also the details about Rs. 500 ands Rs. 1000 old currency exchange.
The Power, Security, Performance and Reliability of NGT in the act of Banning Rs 500 and Rs 1000 Rupee
NGT is a new technology named as Nano GPS Technology. It helps the financial regulator of India and RBI to identify black money and fake currency circulation in market. Though NGT is a new technology, the performance, security and reliability of the Nano GPS Technology is a myth only understandable by top financial officials and the ministries in India including finance ministry, RBI officials, PM, PMO (Prime Minister’s Office), the President of India and finance secretaries and bureaucrats relating to the finance ministry. Apart from this concerns about whether people’s privacy would be affected by NGT (Nano GPS Technology) is another billion question. As the notes with NGT have just been started circulating, we may not know its correct situation currently pertaining to the matters of privacy and security of the individual holding the currency.
How long can we say that Black Money is Out of India after Rs. 500 and Rs. 1000 is Banned?
There is another billion and trillion dollar question to be considered as to how long this NGT currency curb black money and fake currency issues. This topic can be answered only after a few scandals hit the government and the media in the forthcoming days pertaining to fake currency and black money. Also, if there is any policy framework or law correction are going to be made to protect whistle blowers and there are any arbitrary powers to the RBI, CBI, IB, EB and other law enforcement agencies would receive (or) entertain to prevent black money circulation in India in the mere future.
How banning of Rupee 500 and 1000 is going to affect the economy and the Market?
Economical and market changes are going to be highly affected because of Rs. 500 and Rs. 1000 ban currently imposed. Though we see these measures are to remove black money from the society. We are not so much sure as to how is Rs 1000 and 500 is going to affect the Indian economy and the India’s business market. We can expect both merits and demerits from this measure, but the only point of question is whether, GOI is ready to stabilize the economy and the market. We can also expect the worst or the best to come out as a result of Rs 500 and 1000 Ban and the existing new currency circulation.