Money & Banking

Cashing in on coin shortage

G. Naga Sridhar Hyderabad | Updated on September 05, 2013

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If you are going to the neighbourhood grocery store, remember to carry change. Coins have, of late, become a rare commodity.

Retail/petty traders and consumers alike are hit by the severe shortage of coins. They are now buying them from beggars and black-marketers for a premium.

“Earlier, we use to get coins from the Reserve Bank of India’s retail counters and some agents who charged 3-5 per cent. But now there are black-marketers who are charging up to 18 per cent more for change,” Jana Narender, owner of a grocery store here, told Business Line.

“Luckily, beggars are not that greedy. We are sourcing coins from them by paying 10-15 per cent more,” said Gudem Ramesh, a functionary of retailers’ body at Sultan Bazar, a retail market hub here.

RBI’s annual report released a couple of weeks ago testifies to the problem. “There has been a spate of complaints about non-availability or short supply of coins in recent times,” it said.

The Government had also asked the apex bank to take “appropriate” action with regard to distribution of coins. At present, it is also examining the recommendations of a high-level panel headed by Deputy Governor K. C. Chakrabarty on the measures to be taken with regard to mints to increase the supply of coins. The matter is being discussed with the Security Printing and Minting Corporation of India Ltd.

The data show huge shortfall in the indent and supply of coins. For instance, in 2012-13, only 6,878 million coins of various denominations were released into the market while the indent was for 9,554 million. For the current financial year, the indent was for 12,033 million coins but some bankers feel it would be difficult to meet the target and the indent itself was not in tune with the increasing economic activity.

The RBI recently shut down many of its own retail coin sale outlets asking banks to open special counters.

“I agree that there is some unofficial link of lower level staff with retail traders of coin sale. The work pressure in banks is also impacting coin sale in branches,’’ said a top executive of a public sector bank.

>naga.gunturi@thehindu.co.in

Published on September 05, 2013

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