When Prime Minister Narendra Modi announced demonetization of Rs 500 and Rs 1,000 currency notes, Ravi Kumar, a small trader in Noida like many others across the nation, welcomed the decision with enthusiasm.
Two days later, while Kumar still believes demonetization will do “good” to the nation, his zeal seems to have lessened as the transition is taking a toll on his business.
“For the last two days, I have hardly done any business. Yesterday (Wednesday) I had a sale of just Rs 60 in the whole day. Today as well, I got only one customer till evening and did a sale of Rs 250,” Kumar says.
Before demonetization, Kumar says his day at his kitchenware store used to be very busy and he did a business of over Rs 10,000 on a regular basis.”
Sometimes, it used to be as high as Rs 20,000-25,000. I would rarely have time to sit idle at the shop, as customers would keep coming in. But since yesterday (Wednesday), all I am doing is killing time by watching TV as the flow of customers has just disappeared,” he said.
Interestingly, Kumar is willing to accept old Rs 500 and Rs 1,000 notes, so he could at least earn enough to pay the rent for his shop.
“I have a credit card reading machine (Point of Sale machine) as well. But it seems like the will to shop among customers has completely vanished at the moment,” he added.
Kumar is not alone. The business of many traders like him has been severely affected since Wednesday.
Narinder Bansal, who runs a grocery store in Noida, says that since morning most of his customers have been showing up with old Rs 500 and Rs 1,000 currency notes.
“In fact, more people have been coming with high-denomination notes than earlier, as they want to get rid of those. But we have run out of change and have now stopped accepting Rs 500 and Rs 1,000 notes.”
“On the other hand, actual customers are not there as people seem to be saving lower currency notes for emergency situations,” he said.
Bansal added that many of his regular customers who used to buy groceries in large amounts are buying bare essentials since Wednesday.
“Then there is a problem of replenishing supplies as well. If we used to buy 15-20 dozen packets of milk earlier, now we can pay for only 3-4 dozen with Rs 100 currency notes, as Rs 500 and Rs 1,000 notes no longer work,” he added.
Raju Kumar, who runs a vegetable shop, faced similar problems as he has to get fresh supplies every day from the ‘mandi’ (wholesale vegetable market).
“Unlike others, my livelihood depends on fresh supplies of vegetables and fruits. I had to take a loan from friends and family members in Rs 100 currency notes to be able to buy vegetables at the mandi in the morning,” he said.
Kumar agreed with others that very few customers show up with smaller currency notes, due to which he is often forced to refuse sales to them.
“What can I do? I can’t take Rs 500 notes, as I won’t be able to buy fresh supplies in the market tomorrow then. While I agreed to sell vegetables to some regular customers when they promised to pay me later, I cannot do it for everybody. My whole business depends on daily sales,” he said.
Kumar added that he stood in the queue for a long time outside a bank to get new currency notes, but even that did not solve his problem.
“I got one Rs 2,000 note but with most people unfamiliar with it, they think it’s fake. Even after standing in the queue and getting hold of the new currency, I was not able to use it. I hope by tomorrow (Friday), at least the wholesale merchants will start accepting the new notes,” he said.
According to Secretary General of Confederation of All-India Traders (CAIT), Praveen Khandelwal, consumer markets have been affected all over the country.
“Consumer footfall in the markets is very low compared to normal days. Salesmen are sitting idle. Small and rural retailers, who generally visit wholesale markets for procurement of goods, couldn’t do so for want of sufficient funds of acceptable denomination,” he said.
While welcoming the Government’s decision to demonetize higher denomination currency notes, he demanded measures to ensure that business activities are not hampered.