Mumbai: The IT channel has welcomed PM Narendra Modi’s historic decision to demonetize INR 500 and INR 1000 currencies, terming it as “a courageous move to curb anti national activities.” Channel partners said that the move would bring a greater level of transparency in the business and benefit the IT industry in the long run.
In a major assault to black money marketers, PM, Modi Tuesday announced demonetization of Rs 500 and 1000 currency notes with effect from midnight. In his televised address to the nation, the PM said that the decision was needed to stop aid to terrorists and keep a check on the fake money circulation in the country.
The PM said the notes of Rs 500 and Rs 1000 “will not be legal tender from Tuesday midnight. However, he said that all notes in lower denomination of INR 100, INR 50, INR 20, INR 10, INR 5, INR 2 and INR 1 and all coins will continue to be valid.
According to Modi, people holding notes of Rs 500 and Rs 1000 can deposit the same in their bank and post office accounts from November 10 till December 30. Those who fell to deposit their money for any reason will get extended deadline to do so till March 2017, provided they declare their income. He also announced that the government would soon introduce new notes of Rs 2000 and Rs 500. There will be no change in any other form of currency exchange be it cheque, DD, payment via credit or debit cards etc.
Welcoming the decision announced last night, channel partners said that it would help in fighting corruption and terrorism. However, the partners said that the sudden announcement of the discontinuation of INR 500 and INR 1000 currency notes will impact the retail business in the short term as retail customers prefer to make cash payments on purchases below INR 10-15 K.
Ananda Rao Balluru, CEO of Par Data Systems said that the cash flow of the retail business could impact in the short term due to the restriction on cash withdrawal in ATMs and banks.
“ There may be a slide stress on the retail business in the short run as the government has put restriction on the withdrawal of money. However, many resellers today offer facility of cash payments. So, cash transactions will not happen at the retail outlets in the coming days and business will be smooth in the long run”, Balluru said.
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Similarly, Arvind Singh, owner of Maxnet Computers said, “ As far as IT is concerned, all the transactions happen in white. So I don’t think any reason to panic or adverse impact on the business.” Vinod Mulchandani, director of Aarvee Computers said that the flow of money would be tight for the next 3-4 days as people would rush to the ATMs and banks to covert their INR 500 and INR 1000 notes into new currencies and the current notes are no longer valid in the market.
Limesh Paresh, CEO of Enjay IT Solution said that the IT channel community should not get panic because of the decision as all the transactions are duly validated with authentic billing. “ I don’t think that IT industry has huge black money. So we are the community which can hold up their heads at this moment. I liked the way the decision was announced maintaining higher lever of secrecy, which is very rare in India”, Parekh said.
Endorsing similar thoughts, Devendra Deshmukh, CEO of e-Zest Solutions said that the decision would prove a boon for the IT industry as it would facilitate more IT implementation and record keeping of funds. “ It is a well planned strategy started with the JanDhan bank scheme. Now it will be difficult to hoard black money even in case of 2000 currency notes”, Deshmukh said.
The sudden announcement has certainly created panic among the citizens, where people, especially working class and small traders are rushing to banks and ATMs to convert money. The government has sought for cooperation from the nation and assured that the inconvenience is short term.
IT channel has widely appreciated and supported the move and hoped that it would bring “Acche Din” for the IT industry.