It's Illegal,butcoins on sale

City is running out of coins and touts are making a profit out of it

Published: 29th August 2016 05:40 AM  |   Last Updated: 29th August 2016 05:40 AM   |  A+A-

BENGALURU: Joseph Antony, a photographer from Madiwala, loves chewing gum. Though he can make it through the day with one or two, he buys ten — for Rs 10 — so that he does not have to worry about getting the balance amount. "The shopkeepers never have change," he says.

But the shopkeepers aren't deliberately  cheating Joseph. Many are truly out of coins and have constant rows with their customers over this. They approach banks, including the central bank, but everyone is  running low on change. The General Manager of Issue Department, RBI, D Asainathan confirms,"There is a shortage of coins in Bengaluru."

It.jpgIn this shortage, thrives the illegal business of selling coins for a commission. In front of RBI office on Nrupthunga Road, you can see few people walking around with bags and bulging plastic packets. They are agents who collect coins from many sources, including a vending machine inside the RBI office, and sell them to the public by charging a 15% commission.

City Express found seven such agents and approached them as owners of a newly opened restaurant who need change for Rs 5,000. The agents offered coins for a commission of Rs 750. They were obliging and even offered to supply coins on every working day.

"You can always approach us and I can get  you coins even for lakhs," one of the agents told City Express. Nothing could sound sweeter to any small-business owner, except the whole transaction is prohibited.

According to Indian Coinage Act, 2011, selling currency for profit is an offence. The law says "No person shall have in his possession, custody or control coins substantially in excess of his reasonable requirements for the purpose of selling such coins for value other than their face value or for melting or for destroying or for disposing these coins other than as a medium of exchange." This is in Chapter 5, Section 12(1).

Section 13 details the penalty: "Whoever contravenes any provisions of Section 12 shall be punishable with imprisonment which may extend to seven years and with fine."

At the central bank's office, coins are given away only in limited quantities to the general public. An official at the Issue Department tells us that a person cannot take change for more thanRs 300 at a time, and then make the next withdrawal only after 15 days.

But agents say that they get their unlimited supply of coins also from inside the RBI office, and City Express saw two of them collecting coins at the bank's vending machine.

RBI's Asainathan says so far no official has reported anyone withdrawing coins beyond the set limit. "Our officials near coin vending machines will ensure that nobody takes coins for more than Rs 100 at a time."

He says that if there has been misuse of coins collected from the machine, like selling them, they don't have the executive powers to trace this down. "The police department has to take action against them (the agents)," says Asainathan.

Banks 'Poor', Beggars  and Temples to the Rescue

The RBI officials at the direct small-business owners to other banks. "If you want a bulk quantity of coins, you can collect it from the bank where you have an account," says one official at the Issue Department. "Here we provide change only for small amounts."

Merchants and shopkeepers say that they are not getting enough from their banks and so have to get coins from ‘other’ sources.

A restaurant owner on Cunningham Road, Raju, says, "I rarely get coins from the bank. When I do, it is after a long wait. So, I am forced to get the coins from an agent who delivers it in my shop for 15% commission.”

ita.jpgA restaurant manager in Koramangala says that he gets his change from beggars, for a commission of 10%. "We never get change from our bank, so we depend on them," he says. At an eatery in SG Palya, the cashier says that he simply gives chocolates instead of coins.

In Malleswaram, a restaurant owner sources coins from agents and temples for Rs 10% commission. "We are forced to get coins from the agents and temples since banks do not provide us with them."

Banks are facing shortage too. Sampangirama Reddy, manager at Bank of Baroda, BTM Layout says that they don't stock much because they don't receive that many requests from customers. "None of the vendors or merchants come to my branch to collect coins," he says.

But officials of all other banks City Express spoke to say that the coin supply is thinning. Suja Abraham, assistant manager at South Indian Bank, Cantonment Branch, says, "It is difficult for us to get coins because we don't have a currency chest here... We send request to other banks, but there is no response."

A senior official at Canara Bank's Langford Gardens Branch says, "Once in three months,  we get coins for Rs 2,000 to Rs 2,500. If a customer wants a larger amount, we advice him or her to collect it from RBI."

Official at Vijaya Bank's Brigade Road branch says that they disburse coins only to "important customers".

Managers with State Bank of Mysore and Axis Bank say that if a customer needs a large quantity, he or she can give a written request and collect the coins after 4 to 5 days.

Retired head cashier at Bank of Baroda says that shortage of staff in banks is also responsible for this situation.

"Coins take a lot of time to count and arrange... Nowadays banks have only one cashier, and it's a headache for him or her to handle them in smaller bundles. To save time, they simply give out larger quantities to bigger businesses."

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