'We are accepting Rs 2,000 notes': Jewellery stores cash in on withdrawal of high denomination notes

Jewellers in India have started receiving more inquiries for the purchase of gold and silver ever since Reserve Bank of India (RBI) announced withdrawal of Rs 2,000 notes from circulation on Friday.

This increase in the demand of precious metals picked up as most of the small and medium shopkeepers have stopped accepting the Rs 2,000 note since the announcement.  

"There have been a lot of inquiries about purchasing gold or silver with Rs 2,000 notes, hence higher footfalls on Saturday,” said the Ashoke Begani, President of India Bullion and Jewellers Association.

“There is no panic buying as witnessed in 2016 when currency notes of Rs 500 and Rs 1,000 denominations that were in circulation at that time as they were withdrawn overnight,” Ashoke added.

"There have been a lot of inquiries about purchasing gold or silver with Rs 2,000 notes, hence the higher footfalls on Saturday. However, due to strict KYC norms actual purchase has been less," apex industry body All India Gem And Jewellery Domestic Council (GJC) Chairman Saiyam Mehra told PTI.

However, there is a sudden rush of customers who want to pay with Rs 2,000 notes on the petrol pumps. This has led to a scarcity of smaller denomination notes and made it difficult for petrol pump staff to provide change. Petrol pumps in Kolkata claim that they have witnessed a 10-fold increase in payments using Rs 2,000 notes from people buying fuel since the RBI announced withdrawal of the high value currency from circulation.

In a shocking incident that occurred in Jalaun district of Uttar Pradesh, a pump attendant retrieved fuel from an individual’s scooter after he offered to pay with a Rs 2,000 note.

In another surprising incident at Maharaja Chowk in Chhattisgarh, a poster quoting “Rs 2,000 not won’t be taken” was placed on a wall of a petrol pump even after RBI Governor Shaktikanta Das said on Monday that no shop can deny the pink note as it continues to be legal tender.

GOLD RUSH -

A rise in the sale of gold was also witnessed in Indore’s famous jewellery market, Sarafa Bazar. The jewellers in the marketplace said that there has been a significant increase in sales of gold with pink notes after RBI's Friday decision.

The customers were also finding it easier to buy gold from a jeweller, rather than standing in a line at a bank. One customer also said that gold is a much convenient option as they can sell it later when the price of the precious metal increases.  

In Lucknow’s Gol Market, some jewellers are even advertising the ‘solution’ of exchanging Rs 2,000 note with gold. Sanjay Verma, owner of a jewellery shop said that they are running advertisements to make people aware that “we will accept your pink notes”, but only if the customer is carrying a valid ID proof.

In Kolkata, jewellers have witnessed an increase in payment by 15-20 per cent with Rs 2,000 notes, as compared to the weeks before May 19 when the central bank made the announcement, Bachharaj Bamalwa, partner of jewellery chain Nemichand Bamalwa & Sons, told PTI.

With inputs from India Today