The withdrawal of Rs.500 and Rs.1000/- bank notes effective today ( 9 Nov, 2016 ) can cause inconvenience to travellers and tourists who are on the road. Nonetheless, there is no need to panic as there are sufficient measure taken by the government to minimize the inconvenience.
If you are travelling in India and are on the road, then we help you to understand and navigate the impact for short term and long term travellers.
What is the BIG Change, that every one is talking about ?
The legal tender character of the notes in Old High Denominations (OHD) of ₹500 and ₹1,000 have been withdrawn. In consequence thereof withdrawn OHD notes cannot be used for transacting business and/or store of value for future usage.
How do you exchange the currency notes that I already have ?
The OHD notes can be exchanged for value at any of the 19 offices of the Reserve Bank of India or at any of the bank branches or at any Head Post Office or Sub-Post Office.
You will get up to ₹4,000 per person in cash irrespective of the size of tender and anything over and above that will be receivable by way of credit to bank account.
You do not need to go to your personal bank branch to exchange upto ₹4,000 per person in cash. This can be done at any bank branch with valid ID proof. For exchange over ₹4,000, which will be accorded through credit to Bank account only, you need to go to the branch where you have an account or to any other branch of the same bank.
If you are a foreign tourist to India, what do you do ?
You can purchase foreign exchange equivalent to ₹5,000 using these OHD notes at airport exchange counters within 72 hours after the notification, provided you present proof of purchasing the OHD notes.
For ATM Withdrawals are there are restrictions ?
It may take a while for the banks to recalibrate their ATMs. Once the ATMs are functional, you can withdraw from ATMs up to a maximum of ₹2,000 per card per day up to November 18, 2016. The limit will be raised to ₹4,000 per day per card from November 19, 2016 onwards.
Now that the BIG questions are dealt with, this will impact travellers like us who are on the road for a longer time than just a few days. The immediate impact of this will be:
- Almost everyone carrying OHD notes will need to make a trip to any bank or post office at some point in the coming month to convert them into new denomination cash for an amount upto ₹4,000
- In rural areas and Interiors one may have to carry a lot of ₹100 notes once the ATMs start dispensing them from tomorrow. In urban centres, with the prevelance of Debit/Credit Card POS one should prefer its use over cash.
- Mobile Wallets especially PAYTM & Mobikwick will be in use a lot in urban centers as small business merchants are already using them for accepting payments. Download the relevant apps and have some cash there for making small payments wherever they are accepted.
For hotel/travel bookings either do them online or with travel operators that accept plastic cash.
- For travellers with cars, filling up your gas tanks may be a good idea as the OHD notes will be accepted at Gas stations for the next 3 days until 11 November.
- Rail / Airport tickets may also be bought with OHD notes until 11 November, post that keep cash at railway stations as most ticket stations in the interiors do not have the capacity to accept plastic money.
In the long term, this move will benefit travellers, as one need not carry cash in wallets. Everything will be digitized and with the new push on using Digital Wallets and ECS to make payments, the experience of travelling in India will be similar to travelling in other western coutries. Also with the introduction of ₹2,000 notes carrying cash will be a bit more easier.
Happy travelling and stay calm!
P.S: Have we missed out on any pertinent point, or you would like to know more about it, then do write in the comments and we will help with your queries with the best of our abilities.