Nanded cash shortage: Ashok Chavan writes to RBI on rural economy strain

BJP Rajya Sabha member and former Maharashtra chief minister Ashok Chavan has flagged a cash crunch in Nanded district to the Reserve Bank of India. Chavan said cash access mattered for rural areas, even as banks urged digital payments. The complaint came during peak wedding bookings and farm spending linked to pre-sowing work.

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Chavan wrote on April 26 to the Regional Director of the RBI Nagpur division. The letter linked the shortage to rising local demand for notes. It said weddings were underway and farmers had started buying inputs. Chavan warned the mismatch was disrupting daily needs in villages and market centres.

RBI cash shortage in Nanded district

In the letter, Chavan wrote: "I wish to draw your urgent attention to the critical currency shortage currently prevailing in Nanded district. We are presently in the peak of the wedding season, and farmers have also commenced their pre-sowing preparations. Consequently, there is a high demand for cash in the local market,\"

Chavan cited figures from the State Bank of India Shivajinagar branch. The branch functions as the main currency chest for Nanded district. The letter said the chest branch limit stood at Rs 450 crore. However, only Rs 70 crore in cash was available at the time, Chavan said.

Chavan said the shortfall was forcing banks to curb large withdrawals. The limits were affecting common citizens, farmers and traders, the letter added. Chavan said rural branches were asking customers to use digital options. Chavan also said physical cash still supported many rural transactions and local trade.

Chavan warned that a prolonged shortage could hit key seasonal activity. Chavan said wedding celebrations could face payment issues. Chavan also said agricultural tasks could slow without cash for labour and inputs. The letter urged the RBI to note the seriousness of the situation in Nanded.

RBI cash shortage in Marathwada and Rs 500 notes

A wider shortage of Rs 500 notes was also reported across the Marathwada region. Banks and ATMs in districts including Chhatrapati Sambhajinagar were dispensing smaller denomination notes. Bank officials said the mix of notes changed because cash supply from the RBI remained low. As a result, customers received more lower-value currency.

Bank officials said Chhatrapati Sambhajinagar was receiving only a fraction of required cash. They estimated the supply at about 20 to 30 per cent of demand. When asked, a senior bank official said, \"The supply of cash from the RBI is not meeting the needs. We cannot disclose the amount coming from the RBI, but it is around 20-30 per cent of what we need. We are not receiving Rs 500 currency notes from the central bank.\"

The official said the issue extended beyond one district in Marathwada. The official said, \"The problem is not just in Chhatrapati Sambhajinagar but also in other districts of the Marathwada region. This problem also exists in other districts of Marathwada including Chhatrapati Sambhajinagar. We are receiving cash currency of smaller denominations from the RBI. It may take 15 more days for the situation to normalise,\"

The official also pointed to ATM operations as a concern during the shortage. The official said, \"We also need Rs 500 denomination notes in the ATMs which are currently less. So, banks have started keeping less cash in the ATMs, the official told.\" The comments reflected ongoing pressure on branches and ATM refill plans across the region.

With inputs from PTI