Prime Minister Narendra Modi announced that currency notes of Rs 500 and Rs 1000 would be scrapped. The scrapping of old Rs 500 and Rs 1000 note will definitely have a short-term impact on the purchase of the automobiles. In the Indian market, there are many consumers who still purchase cars in cash and a lot of dealers are worried regarding the booking amounts that is usually payed via cash by people.
Addressing the nation PM Modi said,"You have 50 days (from 10 Nov to 30 Dec) to deposit notes of Rs 500 and Rs 1000 in any of the Bank and Post office".
"The customers who have planned their purchases in November will shift their purchase to next month. There will be an impact on November sales, as people who used pay the margin money and booking amount in cash have to wait for some time" said Nikunj Sanghi, Managing Director, JS Four Wheels.
As per industry experts, a significant short-term impact on the auto industry will be witnessed, though not on a longer run. "SUVs and luxury cars to have an impact on sales in the short term. However, on the longer run, there would not be much effect. However, it would not have much impact on the small cars," said Abdul Majeed, Partner, Pricewaterhouse.
Reserve Bank has decided that all the banks will be closed on November 9 and new notes of Rs 500 and Rs 2000 will be introduced. The new notes will be brought into circulation and thereafter, with the introduction of new currency notes, RBI will take certain steps to control the amount of currency in circulation. But still, the changing and circulation of new currency notes will take time. The replacement currency to will be in troduced in 3 - 4 weeks said Finance Minister, Arun Jaitley.
Here are some details that you should know about the currency exchange, deposit, withdrawal, shopping and payments -
While, online transportation network company such as Ola has welcomed this decision on existing high value currency demonetization. Co-founder & CEO of Ola, Bhavish Aggarwal said that we welcome this landmark move by the Hon'ble Prime Minister and its is our first major step towards a cashless economy and bringing convenience with transparency for every Indian, as a nation. He also added, “This move is integral in realising our shared vision of a Digital India.”