Thursday, November 24, 2016


Dear IAC-ians

Please note the following

1) Following a certain email of ours to the Dept of Financial Services (copy of which was sent to IAC mailing list), the Govt was compelled to

a) stop exchange of old MG series Rs. 500 and Rs. 1,000 notes with immediate effect,
b) rebrand it as "re"monetisation instead of "de"monetisation

2) A new concern has arisen that some dubious / defective Rs. 100 "new" notes are being readied to be pumped in huge volumes into the banking system via banks. These seem to be of foreign origin, are printed in the year 2016 and have the same telescopically enlarged note numbers as new 500 and 2000 notes. IAC will be querying the RBI on these notes first thing tomorrow since (we hear) apparently 8 chartered flights have landed packed with these notes which RBI had got printed abroad. Till RBI responds to us, IAC-ians may consider declining any "new" Rs. 100 notes printed in 2016 (see the note's year on note backside bottom in the centre - very small print) as legal tender.

Our "inside" sources remind you to recall that on 9th Nov IAC had written

"4) So remember this - only accept OLD NOTES or OLD COINS as a temporary measure. Do not make the mistake of accepting shiny NEW NOTES for OLD as 'Alladin' did."

3) IAC is not going to be circulating any more emails praising / criticising Mr. Modi for this step. It is a waste of our precious bandwidth. The consensus is that "de"monetisation was a necessary step but badly delayed and badly executed (perhaps for extraneous / unstated considerations).

NB: IAC are experts in certain aspects of banking and financial payment systems for financial inclusion. eg. I was a co-organiser of the prestigious FIPS FORUM (Financial Inclusion and Payment Systems forum) which are attended by all the big names in Banking and micro / digital payments. My co-convenor was Prof Rajneesh Dass of IIM Ahmedabad (now with IIM Udaipur)  a world renowned authority on microfinance systems (and its evils).

4) Whatever we are doing is for benefit of our members and the public at large to keep them reliably informed against the flood of rumours / disinformation on social networks.


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