With the Reserve Bank of India’s (RBI) decision to withdraw Rs 2,000 notes from circulation, petrol pumps in Punjab are facing a cash crunch as the majority of customers are using the currency notes to buy small quantities of petrol or diesel.
The sudden surge in cash payments of Rs 2000 note has forced the Punjab Petroleum Dealers Association, which represents about 4,000 pumps in the state, to request the RBI to give guidelines to banks to provide enough notes of small denominations to petrol pumps in lieu of Rs 2000 notes so that they could serve their customers with ease.
“Before the RBI decision to withdraw the Rs 2,000 note, we used to receive about 95 per cent of payments at the pumps through digital mode while cash payments accounted for only about 5 per cent of the total payments. But now, cash payments consist of about 70 to 80 per cent of the total sale,” Punjab Petroleum Dealers Association president’s Sandeep Sehgal told The Statesman.
“The main problem we are facing is that we don’t have much change as we give the cash back to customers from the cash received at the pumps and all our cash gets deposited in the banks on a daily basis. Now, we are getting customers, who buy fuel just for Rs 100 and tender Rs 2000 note for the payment. The problem is we don’t have that much cash to give change for every Rs 2000 note,” he added.
Sehgal further said that last time during the demonetisation in 2016 when Rs 500 and Rs 1,000 notes were rendered invalid, petrol pumps were allowed to accept the Rs 500 and Rs 1,000 notes but later most dealers received Income Tax notices or raids without any fault of theirs as they received more cash payments during that period due to increased sales and outstanding payment from credit customers.
“We fear that the same may happen again as customers are using Rs 2,000 notes for payments at the pumps but we just can’t keep a record of the customers buying Rs 100 or Rs 200 fuel. We may again be questioned over the sudden surge in cash payments at the pumps,” he said, adding that even shopkeepers are using petrol pumps as an easy way out to change their Rs 2000 notes instead of going to the banks.
Sehgal said since it’s a legal tender, pumps can’t say no to Rs 2,000 notes given by any customer. “But we just can’t give the change back to every customer who buys Rs 100 fuel and makes payment by giving a Rs 2000 note. The problem is customers don’t want to wait for getting the change,” he said.
The RBI on Friday announced the decision to withdraw Rs 2,000 banknotes which can be deposited and exchanged at the banks till 30 September.