India has now adopted a new measure after scrapping off the 1,000 and 500 rupee notes from circulation to ensure that people have only a single chance to exchange their old currencies for new ones.
Everyone going to exchange their notes will have indelible ink marked on their fingers so that the time of making the exchange is reduced. This is in a bid to stop “black cash” holders from removing their banished rupee notes in little tranches. This is a move borrowed from the electoral sector where people have their little fingers marked with ink to stop double voting.
Only one exchange chance
The government has requested people to make deposit of their old notes in their bank accounts or be allowed to exchange a maximum of 4,500 rupees for smaller denominations. But in order to burst the holders of illegally held or laundered money, people are allowed to carry out the said transactions only once. Banks are therefore using the indelible ink to curb multiple depositing.
Those in support of the move say that this comes as a handy method of tackling corruption in the country. The ministry of finance has however expressed their concerns regarding some unscrupulous moves by people trying to circumvent the clampdown by using proxies to carry out the exchange for them.
The government’s move targets illegal money as well as those who have been escaping taxes by holding cash stockpiles. Even though the Indian authorities claim that everyone has a single chance to swap their old notes, critics are questioning what will happen if people find a way to wear the ink off.
The ban received a widespread approval at first because at most 3 percent of taxpayers file their returns. However, the move has resulted to millions of people queuing for extended hours to exchange their old cash as well as make withdrawals. Money supply in the country has reduced by up to 86 percent.
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