Money & Banking

Business correspondents highlight shortage of cash in rural areas, travel difficulties amid lockdown

Our Bureau Mumbai | Updated on March 27, 2020 Published on March 27, 2020

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Business correspondents in rural areas have highlighted a shortage of cash and difficulties in going about their work due to the nationwide lockdown announced to prevent the spread of coronavirus infection.

“We are in talks with banks and bank branches to provide more cash to business correspondents. We are also in discussions with local petrol pumps, on re-using the cash they have,” said Sunil Kumar, Director General, Business Correspondent Federation of India on Friday, adding that the situation could aggravate in the next five to seven days.

According to Seema Prem, CEO of FIA Technology Services, a lot of rural bank branches are shut and others are rationing cash. “Bank mitras rely on link branches. Banks are not able to move cash from the chest to various link branches. We see this problem across most states,” she said.

She also highlighted problems bank mitras are facing in travelling from their houses to bank branches and to their customers, as police often do not allow them to commute.

Announcing the Rs 1.7-lakh crore economic package, Finance Minister Nirmala Sitharaman had said that banks and bank branches, ATMs and banking correspondents are all essential services and will continue to work during the lockdown.

Talks are on with banks to ensure steady supply of cash at rural bank branches, said Amit Jain, Chief Business Officer, Fino Payments Bank.

According to industry data, just about 30 per cent of the bank mitras or BCs in rural areas are continuing to work.

Meanwhile, to incentivise BCs to continue working, Bank of Baroda on Friday announced financial support of Rs 2,000 to each active and functional agent, towards maintenance of hygiene at their outlets for purchase of sanitisers, disinfectants, masks and gloves, and the amount has been credited directly into their accounts.

“Further, the bank has encouraged the BC agents to extend their services during this difficult period, and has also decided to incentivise them by paying Rs 100 per working day to every active BC agent towards transportation for extending services from 10 am to 5 pm, by performing at least five transactions,” it said, adding that the facility will be available till April 14.

Published on March 27, 2020

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