Representatives of trade and industry today hosted a press meet and they have listed the difficulties they are experiencing due to demonetisation of high value currency. This meeting took place at CODISSIA Trade Fare Complex, this evening.
The issues faced by the trade and industry are follows:
Shortage of cash available in the system, especially for a city with the industrial and commercial importance like Coimbatore. Government is requested to rush cash to the city and make it available in all ATMs and banks.
The withdrawal set by the government for current account holders is not sufficient to pay the employees in industries and MSMEs. Also the government should fix the transaction limit based on the history of transaction of trades and industries.
Lack of small denomination currency has adversely impacted the trade. Government should take immediate steps to address this problem.
Trade and industries are facing a loss of 30% to 80% in their business. This has in turn impacted the cash flows, due to which the dues to government, bank borrowings and salaries on time. Government should make an announcement that a moratorium for repayment of loan and to extend the time for paying the duties and taxes.
The time given for opening bank accounts for employees is insufficient. The banks are not equipped to handle the sudden increase in volume of bank account opening requests. The banks also ask for Aadhar and PAN card, which most of the employees, especially the migrant labourers from other states don’t have.
In order to encourage the public to use ATMs, Debit cards and ATMs the Government should instruct all banks to wave off usage charges for such cards.
NPA norms should be increased from 90 days to one year as it has a huge impact on the businesses.
Cash credit limit should be increased for industries and traders as this will help the industries until the situation is normalised.
Representative of CODISSIA, ICCIC, SIEMA, SIMA, IIF, SISPA, COINDIA, TECA, BAI, CREDAI, ISMA, CEBCA, COSIEMA, TACT, COTMA, KOPMA, TAPMAA, COWMA, TMMSMA, COPRTA, SICBMA, EIEWA, CODETA, GITA, AIGMA, AIGEA, CODI CAMA, SIEA, COSMAFAN, CSIMA, CODEA, SIFMA, CMPDA, CLOA, CYMBA, Pollachi Chamber of Commerce, Coimbatore Jewellery Manufacturers Association, The Coimbatore Jewellers Association, Coimbatore District Hoteliers Association, The Coimbatore Rice Merchants Association, Coimbatore Pipe Merchants Association, Coimbatore Marble and Granites Association, The Coimbatore Consumer Products Distributors Association, Paper and Allied Merchants Association of Coimbatore participated in this meeting.
Vanitha Mohan, President, Coimbatore Chapter, The Indian Chamber of Commerce and Industry when speaking to the press said ”The very important problem that we are facing today is cash crunch. We are not able to pay salaries to our employees. The Government made an official announcement that the withdrawal limit is Rs.50000. However, the banks are out of cash.”
“Even if we open bank account and credit the money in our employees account, they are unable to withdraw cash as the banks are out of cash. Employees have informed us they cannot stand in queue, to withdraw money from the banks as it is impacting their work hours. The trade and industry sector is struggling to pay wages. Last month, wages were paid using cash we had.”
“Opening a bank account is not the solution as a majority of our workforce are migrant workers who do possess an Aadhar or PAN card. Thus, we are making a request to make cash available in the banks.”
She added that the trade and industry sector is not against implementing cashless transactions. “Don’t ask us to implement this immediately give us some time. We don’t have a second opinion on the implementation of cashless transactions but we need time. We cannot switch to cashless transaction overnight. Coimbatore is an industrial city. The businesses in the city are suffering due to the demonetisation. On one side the government is pressuring us to go cashless and on the other side employees are unable to draw cash from the banks even if we switch to cashless transactions.”
At this press meeting, President of the Coimbatore Chapter of The Indian Chamber of Commerce and Industry said that various associations of the trade and industry sector have prepared a memorandum that will be presented to the Prime Minster. “We have prepared the memorandum detailing the challenges that the trade and industry sector is facing owing to the demonetisation process. We are seeking an appointment with the Prime Minister and we are positive this time we will achieve a breakthrough in form of a solution.”