Since December 2018, BEST employees have been getting Rs 500 monthly in coins, as part of their salary. (Express photo)
The cash-strapped Brihanmumbai Electric Supply and Transport (BEST) is finding it difficult to either use or get coins worth Rs 10 crore lying with it deposited in banks in exchange for notes. BEST officials said they had approached RBI after repeated letters to 13 banks in the city elicited no response.
In a desperate move, BEST has been paying its employees Rs 500 monthly as part of their salary in coins since December 2018.
Coins have been pouring in at BEST since July 2018, when minimum fares were slashed to Rs 5, Rs 10 and so on from Rs 8 for a minimum of 2 km to Rs 34 for 20 km earlier. Officials say the coins are difficult to carry and conductors have complained about the weight.
A senior BEST official said, “About 70 per cent of our daily ticket sales of Rs 2 crore are in coins. Most of these are Rs 5 coins, which are heavy. We face difficulty carrying them as well as calculating them at the end of the day and depositing them in banks.”
BEST General Manager Surendrakumar Bagde told The Indian Express, “We are trying to come up with a solution and are in talks with RBI. In the meanwhile, we would request our customers to make digital payments as much as possible.”
The BEST management conveyed the problem to RBI at an informal meeting on December 31. According to sources, the banks which have not responded to its letters to accept the coins are the 13 with which they transact on a regular basis — including State Bank of India, Bank of India, Canara Bank, Bank of Maharashtra, Bank of Baroda and three cooperative banks.
In a letter to Canara Bank, BEST wrote, “The BEST undertaking is providing public transport services covering 90% of the area, 32 lakh commuters daily. I sincerely request you to accept the coins and cash on a daily basis so that the cash flow in BEST is not hampered.”
In September 2019, BEST had procured coin-counting machines and opened exchange centres across 27 depots to allow citizens and traders to get coins against higher denomination notes. Over the past few months, BEST officials said, they had received several complaints from conductors regarding heavy coin bags.
BEST said its attempt to get toll operators to take the coins had also failed. “The operators were willing to take the coins as well as to give an incentive of Rs 5 extra on change of every Rs 1,000, but the talks fell flat after the National Highway Authority of India enforced FASTags.” FASTags allow toll to be deducted through e-wallet.
ICICI Bank, which has a contract with BEST to collect money, has cited space crunch in its cash chest for not taking the coins. An ICICI official said on the condition of anonymity, “No banks hoard cash, what we collect is put back in circulation. But there are no takers for coins. We send the coins to RBI, but the multi-step process takes several weeks. The coins meanwhile lie unutilised, eating up space.”
An ICICI spokesperson said, “BEST is a valued customer of the bank. We continue to accept cash deposits from the company regularly. However, the inflow of coins from BEST has gone up manifold in the past few months, leading to substantial rise in their storage and handling cost. We have suggested many options to BEST to efficiently manage the inflow. These include installation of coin-vending machines at public places, disposal of coins at toll nakas and adaptation of cashless modes of payment.”
While SBI and RBI refused to comment, RBI officials said they were finding it difficult too to manage the surplus coins and the government should demonetise lower currencies as it had done earlier for 25 and 50 paise coins. Increase in digital transactions and inflation had reduced the demand for coins, they said.
In its estimated budget for 2020-2021, BEST has projected losses of Rs 2,249.74 crore. It is a three-fold increase from Rs 730 crore losses in 2019-20.