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'Demonetisation' aftermath hits Indian banks before benefits

Demand for credit has plummeted while additional costs have been incurred to make the transition
Tuesday, December 20, 2016 - 05:50

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The decision to remove 500 and 1,000 rupee notes has led to a severe cash shortage as the Reserve Bank of India has replaced barely a third of the higher-value notes that had been in circulation.

Mumbai

INDIA'S shock move to abolish high-value banknotes was expected to deliver a windfall to lenders, and banks have indeed seen coffers swell after people deposited 12.4 trillion rupees (S$264.7 billion) in cash into the system.

But while banks may benefit in the longer term,

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