In the one-hour journey from Coimbatore to Tirupur, one usually comes across at least half-a-dozen vendors selling “Tirupur” garments at throw away prices. With their arms loaded with a dozen or more garments, mostly t-shirts, the young/middle-aged vendors move from one compartment to another asking travellers to “try one on.”

But over the last two weeks, most have disappeared and those who remain struggle to find a buyer. Says Jegannathan, a vendor, “Travellers have turned frugal in spending. Before the withdrawal of ₹1,000 and ₹500 currencies from circulation, we were able to sell at least 10 shirts a day. But now there are no takers.”

Most of these vendors are from Khaderpettai, just outside the Tirupur railway station. There are over 2,500 shops here and they lend the last mile support to domestic garment suppliers. But dependent on cash transactions, this market too has taken a hit post the demonetisation move. Barring a few, most of them have shut shop. The few who are still open for business have got PoS machines, but not many customers bother to come.

Some like Jegannathan are looking at other avenues to eke out a living. 'I am not educated or skilled. I have been selling this stuff for over 20 years, and have managed my life with this commission income. I do not know any other job,” he said, sounding worried.

The squeeze The Tirupur garment industry comprises of exporters, merchant exporters (who provide services such as buttoning, ironing and packing) and domestic suppliers. According to the Tirupur Exporters’ Association, exports brought in ₹23,000 crore last year

While the exporters mostly deal with cashless transactions, the other two segments depend on cash and have been hit by demonetisation. The cash crunch over the past three weeks has seen exporters cutting their subcontracts by 25 per cent.

While few want to speak out, locals point out that domestic suppliers are the worst hit. A t-shirt costs ₹100-120 and even if a customer were to buy two of them, few vendors would have change for the ₹2,000 note. And the buyers are holding on to the ₹100-notes to buy every-day bare essentials.

Plastic payment is not a popular option as most of these traders have been outside the tax net. They have to first get a PAN card before applying for a PoS machine.

The garment industry, according to Raja Shanmugham, President of the Exporters' Association, engages up to 8 lakh workers, half of whom are directly employed. But as the cash crunch continues, not many of them would be able to hold on to their jobs. Industry insiders say that close to 1,000 units – particularly those that operate on “all cash” supply chain – have either partly or completely halted production. Owners don’t have the cash to pay wages, and the supply of cash is drying up due to receding sales.

At the same time, the industry seems to be coming to terms with the fact that they would have to prepare themselves for a cashless future.

Krillo Garments for instance, employs 100 people and their wages, according to the unit's manager Paulraj, has been credited to their respective bank accounts. This was possible because most of the employees had opened bank accounts as long as two years ago. “There are some migrant workers too, some of these people have an account, while for the rest we are collecting identity proof, so as to enable them to open an account. While bankers are holding camps and trying to get every individual into banking fold, there is huge shortage of lower denomination notes. People have adjusted, but the currency shortfall is the issue at this juncture,” said Paulraj.

Also, not everyone is comfortable using a debit card. Rajalakshmi, 55, a worker in a garment manufacturing unit, recalled her nightmare.

“The long queues put me off. Until that day, I had banked on a friendly neighbour to draw cash for me by sharing my four-digit PIN. But this time, my neighbour bluntly refused after seeing the queue. So I had to learn to do it, but the crowd waiting behind me seemed restless, as I stood there in front of the ATM, clueless as to how to insert the card in the socket. A boy, who stood just behind helped. Now I am able to do it myself.”