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The Finance Ministry is used to receiving strange requests, but this could easily be one of the strangest it has got — representations and frantic calls to allow shagun money, given as wedding gifts, in old denominated currency notes.
However, sticking to its ground, the Ministry is advising all to instead issue cheques that can also be used as capital by the newly weds.
Sources said a number of private hospitals have also been seeking an exemption on the lines given to government hospitals that allow them to receive ₹500 and ₹1,000 notes for 72 hours. But the Ministry is concerned that it could be used as a means to convert black money to white and has instead said patients seeking treatment should use cheques or debit/credit cards.
The white goods industry, too, has been betting big on the long wedding season and the boost in demand going beyond the festive season. Industry players said there could be some impact on sales of white goods in the short-term, especially in smaller cities and rural regions.
A senior executive with a consumer-durable firm said this move may see reduction in spends during the wedding season for the short term, as consumers tend to buy appliances for gifting purposes through cash.
CM Singh, COO, Videocon said: “This announcement comes after the festive season, when a large chunk of individual purchases have already happened. Additionally, in cities, a significant chunk of purchases now happen through financing schemes and credit/debit cards. We believe things will eventually stabilise as this is the law that everyone has to follow.”
Kamal Nandi, Business Head and Executive Vice-President, Godrej Appliances, said: “We expect more and more transactions to happen through financing and debit/credit cards. Already 30-40 per cent of purchases for white goods are done through financing schemes. Initially, there may be some impact on buying sentiment as consumers get used to the changes, but we believe it will be business as usual in the next couple of days.”
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