Not necessarily black. White money people like me also have them.
My question
How does this affect the common man that most are criticizing the withdrawal of the currency. Most say, they never used 2000 in circulation for their day to day living. So it is obvious that it has now become a store of value than used on a daily basis⌠I know a elderly lady who had kept 2000 x number of notes in her house in case of emergency. These notes can easily be exchanged at a bank. So why so much angst in removing this.
I am sure, RBI must have stopped printing this notes thinking it will come back to them during normal business transactions. They might have waited but this was not happening as a considerably amount is stuck with some section of the society. To flush this out, this was the only source I guess.
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@neha1101 Its not about a citizenâs day to day use⌠Look at it from the Economy point of viewâŚ
The first demonetization was a puncture in a well running economy added by the complete unprofessional way of executing and handling the whole demonetization process, with zero support to the small, medium and slightly big businesses that dealt with 500 and 1000 Rs currency to run businesses. Let alone the cost involved behind demonitization and its handlingâŚ
The 2016 demonetization could have been positive only if it was well planned and handled wellâŚ
This demonetization is also going to be a hole in our economy which is not doing as well as the economy we had in 2016 and priorâŚ
Hope this clarifies the impact of demonetizationâŚ
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What is Amul trying to say here?
The only way to catch few rats is to bring down the whole house.
This I think is a very smart move by the govt. They did the same in 2016. Modi should be praised for this move.
There is literally no impact to anyone who is earning in a formal sector. That means 99.99% of all middle class people do not have anything to complain about.
The impact is felt for people who are dependent on the informal sector - kirana shops, roadside vendors, travel agents, drivers, brokers (land, sand, water, cash-transfer agents), dalals etc who get paid in cash
Poor is affected not because they have lots of Rs2000 with them, but because they dont have enough avenues to save money (most of them may not even have a bank account, so naturally they would exchange 4x500 for 1x2000 to keep it in physical form)
Poor people should not have been disrupted even in Demonetization 1. But most of them panicked feeling their money is worthless. Talk to any poor person - thats the perception they got.
Rich is also affected, but they will find a solution much faster than the poor.
âWink winkâ right. I get it.
https://rbidocs.rbi.org.in/rdocs/notification/PDFs/BANKCIRCULARA39F07C7247D4D4D9C90F4EB0CAF5D96.PDF
RBI/2023-24/32
DCM(Plg) No.S-236/10.27.00/2023-24
âš2000 Denomination Banknotes â Withdrawal from Circulation; Will continue as Legal Tender
Friends here it begins
The only good thing to come out of demonetisation of 2016 was upi. It has sling shot india far ahead of many 1st world countries in terms of payment infrastructure & digital banking. I donât know what kind of luck they are hoping for this time.
I remember in 2016, there were many low income people who were paid a cut of the money to exchange 500/1000 rupee notes which meant all the black money was pretty much washed & only put a massive dent on the economy. Also, gov simply expected banks to filter out black money by vetting their customers, which should have been a big red signal. Bank will always put their own business interests above the gov. The disruption of small businesses and massive inconvenience to common citizen was the only outcome.
This round of stupidity may not be as inconveniencing as last time. The gov may not be able to come up with any good ideas. But that doesnât make it okay to keep implementing the same bad ideas with no leanings from the past.
okay, now the hoarding will happen with 500&1000 like the good old days. What exactly is the point of this article?
Rs.1000 is an obsolete denomination FYI. Hoarding with lower denomination Rs.500 is more difficult than with Rs.2000.
Its apparent from the article 
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To hold 500 denominations you need 4 times the space of 2000 denominations.
I would even want RBI to stop printing 500s from now on. Print only 100s and 200s and without informing us pull back even 500 over the next 5 years. Any 500 note which goes to back in next 5 years shouldnât come back. So if anybody is holding 500 that means that note never went to the bank. When the max denomination is 200 then people will be forced to go for digital transactions.
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For a country of our size and based on our economy do you think INR 200 as the largest denomination is fine.
I am sure, all those who have Black Money will now move into Gold. This is better than having uncertainity as to which currency they will take it out. How come Gold can be bought in large quantity with cash?
All said and done, I believe this move was good, it is required as it will shake up the system. I still believe this 2000 does not impact comman man at all.
A related question to @Jason_Castelino as he is from kerala. When a person holds property and when she wants to sell the same, there is a minimum price fixed at the lands department, which is peanuts. The actual sale happens at double that price. All these years, the buyer brings cash and gives it. Now what happens in the following case
Example - 1000 was the minimum price fixed at lands department, the seller and buyer agreed that they will do the transaction at 2,000. This was rejected at the lands department as it seems it was way ahead of the minimum price. The logic being if the transaction took place, they have to increase the minimum price - Is this true.
Seller wont agree for 2000 at registration and will insist on 1000 which means the buyer need to give him cash of 1,000 How will this work with so many restrictions on cash withdrawl from banks.
I was also told that this issue is not there in Mumbai as the price differential is marginal.
Real estate is one of the large ticket items. If the authorities themselves dont allow full transactions to be recorded, this will result in black money.
They should seriously bring out a platform online so that buyers and sellers can quote their price and execute the same online just like we buy shares. This will avoid lots of cash transaction.
All of the above are what people tell me and hence wanted to know if it is true in Kerala.
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I thought he is from Mangalore.
Property dealings can be done via cheque or electronic mode only if transaction amount is greator than Rs.20000
The real estate industry took a hit since this law came into existence for reasons we can guess.
Market value and fair value decided by govt can be different. So I donât think lands dept will object to the transaction. Did u face any issue like this ?
Buyer giving cash like this is not acceptable through the white route.
Honestly no. Itâs not fine. But then people will get used to digital mode of payment. These days I see even a person who goes from shop to shop selling tea accepts UPI. If he can bigger businesses also can right. Rickshaw drivers want only UPI because they donât even have change.
The ones transacting in cash for bigger transactions are the ones who do not want money to be tracked in their bank account.
No doubt. I always felt black money should be kept in gold. Cash doesnât give any return. Gold over a period of 5 years will give positive return.
I am from Mangalore and it an undisputed part of Karnataka. 
This has reduced a lot compared to what it was 10 years back. Recently my friend bought an apartment for 1.8cr. The government value was around 1.2cr and my friend wanted to pay the difference in cash for two reasons. 1. Save stamp duty. 2. Get rid of black.
But the builder denied. After rera came in this has reduced a lot. What will the builder do it with that unaccounted money? Finally he agreed to take only 5 lakhs in cash.
Never heard of this. There is only min stamp value. No max.
In my city itâs around 20 percent. Not more than that.
Yes. I think they tried with property card. They should also start listing it. One place for all buyers and sellers to meet. And transactions should happen through this portal only. But I donât see this happening for 20 years at least.
Just wanted to confirm again. Mangalore is part of Karnataka.
In UP also Circle rates are almost half of the market rates. But thats just the minimum value at which property has to be registered. Transaction can happen at any value upward of Circle rate. Doesnât matter if itâs 2x, 5x, 10x whatever. You can quote whatever price you want. Buyer pays stamp duty at 6% of registered value (5% if property registered in women name) and seller pays Capital gains tax to income tax department.
But people get property registered at Circle rate and pay the rest in cash. (Not only corrupt, even honest people withdraw cash from Bank and pay) to save taxes.
At least 30% of the deal goes in Cash.
So the system is making people have black money. When this is the case whom to blame??? The same issue does not exist in stocks. They need to pay capital gain on the sale. No one can fudge the same.
Hence this should be fixed first so that common man who sells property need not hold physical cash
Not the right thread, but the problem is much bigger.
The Govt. rate of tax is higher for all segments. For eg: soap has a GST of 18%. Now the soap maker will think his ROCE should be much more than that.
Refrigerator has a GST of 28% - how much margin should the manufacturer take?
We are in a system where the Govt. gets more money than a manufacturer or distributor w.r.t efforts put in.
Same is the case with income tax.
Govt. might say the % of people who are in the tax net is lower, so we need to charge higher to compensate for it. Honestly if you ask any common man whether he wants a bill for the soap or save 10% w/o bill - what would he select?
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