Rs20-25bn withdrawn in Ramazan: Shopping, donations
By Shahid Iqbal
KARACHI, Nov 3: Despite lack of enthusiasm this year for Eid shopping in the wake of disastrous earthquake in the country, the trend of withdrawal of cash from banks was high in the last 15 days before this Muslim festival.
Bankers were unable to give firm up figures of cash withdrawal during the month of Ramazan but said that up to Rs20 to Rs25 billion were withdrawn from the banking system by the people.
Heavy withdrawals were noted in National Bank, Habib Bank, Muslim commercial Bank, United Bank, Allied Bank, Union Bank, Bank Alfalah and some other foreign banks.
Bankers said that massive withdrawals were recorded in the last 15 days of Ramazan when Eid shopping started picking up. In the beginning of the Ramazan this year the cash outflow was extremely slow as the earthquake had its impact on the general public mood in the country.
“The amount of cash outflow can also be measured through the banks’ borrowing from the State Bank which was more than Rs20 billion in the last week of Ramazan,” said a banker.
However, some bankers believe that the withdrawal was less than previous year’s figure, but their opinion was based on rough estimates. “Banks usually don’t have exact figure about the outflow from each branch across the country.”
They said that the earthquake which displaced about 4 million people and killed over 73,000 in the North West Frontier Province and Azad Kashmir was a major cause for slow withdrawal from the banks. They believe that withdrawal could have been much more had the country not experienced the calamity.
Some bankers said that people withdrew cash from banks to donate toward relief operations in the quake hit areas. All major banks have revived their branches in AJK and other quake hit areas.
“We know that many people have transferred cash to the people living in the affected areas through these branches and they did not use their money for Eid shopping,” said a banker of NBP.
Thousands of people withdrew their cash to purchase blankets, jackets and sweaters for affected people. In Karachi, customers faced difficulties to withdraw their cash from banks because of rush on banks due to short timing and inefficient performance of Automated Teller Machines (ATMs).
“Handling billions of rupees on daily basis is not easy. Mismanagement is natural,” argued a high official of MCB, adding that it was an extra ordinary situation.
Another banker said that efforts were on for the revival of banking operations and quick transactions of money in the quake hit areas.
The shortage of ready cash created problems for the depositors and banks borrowed from the State Bank to meet the shortage. Bankers said the liquidity crunch would be over within 4 to 5 days after Eid holidays. “The money which outflows from the banks would come back into the system as traders and businessmen would start depositing their earnings into the banks after Eid,” said a banker.
