Currency Exchanges Boost Gold Shops in Hyderabad

Realtors and businessmen in Hyderabad are using gold and jewellery shops as an alternative way to exchange their Rs 2,000 notes. The Reserve Bank of India has permitted individuals to exchange these notes at its offices and banks, but the response has been poor. People are flocking to jewellery shops instead. Some shops are charging a premium of Rs 65,000 for accepting these notes, which is Rs 3,000 more than the actual market price. This allows customers to avoid visiting banks and submitting documents. The real estate business often uses these notes for cash transactions. Gold businesses have the advantage of depositing any amount of money into their current accounts, similar to fuel stations and wine shops, and there is minimal opportunity for tax evasion. The rush to exchange notes in the market is not as significant as during the demonetisation period.