Mumbai: HDFC Bank managing director Aditya Puri today termed the demonetisation as a “necessity” which will benefit the economy in the long run by way of rate cuts, stopping counterfeiting and broadening the tax base.

“We, at HDFC Bank, feel this is a laudable objective which will provide benefits to the economy and people in the long run,” he said in a note to bank account holders.

He said the demonetisation exercise announced by Prime Minister Narendra Modi on November 8 is a “necessity” to root out counterfeit notes, which have a direct correlation with terror funding.

Stating that an effort is being made to ensure that people conduct their business in a fair and transparent manner, the veteran banker said a country cannot progress if less than 10 per cent of the population pays income tax.

It will also help root out corruption and bring down the cost of banking services, he said.

As part of the exercise, the government scrapped Rs 500 and Rs 1,000 banknotes from the midnight of November 9, and introduced new series of Rs 2,000 and Rs 500 notes. This has led to confusion and long queues to access own deposits.

With a large amount of the cash stuck in an unproductive manner earlier, Puri said it is “imperative” that the savings are used to boost investments.

“This will give banks the capacity to lend and also to bring interest rates down in order to spur investment and be competitive,” he said.

Citing a MasterCard study, Puri said that cash involves high costs of up to 1.5 per cent of the GDP on printing, transporting, storage and soiled notes, and a move to digital as is being witnessed in the fortnight since the move, will help not just the customers but also the economy.

While doing so, it is necessary to ensure that people in semi-urban and rural India also get the convenience of using the digital services, he said.

Puri also made an appeal for faster adaption of digital channels, saying this will help not just the bank but customers as well.

“It is necessary that we all understand that the country is moving towards reduced usage of cash,” he said, adding digital banking is a joint effort across all stakeholders.

Full text of email

We truly appreciate your co-operation and patience during this period of transition.

It is necessary that we all understand that the country is moving towards reduced usage of cash. Going forward, ‘Digital’ banking is a joint effort between the Government, banks and customers.
Fundamentally, the aim is to ensure that a customer is not inconvenienced on account of not carrying cash. We, at HDFC Bank, feel this is a laudable objective which will provide benefits to the economy and people in the long run.

Just to list out a few:

Demonetisation is almost a necessity to root out counterfeit notes which have a direct correlation with terror funding and other fraudulent activities.

If a country is to progress we cannot have less than 10% of the population paying Income Tax. An effort is being made to ensure that people conduct their business in a fair and transparent manner. Increased ‘Digital’ transactions will not only provide convenience to the customers but will also root out corruption and bring down the cost of banking services.

It is imperative that the savings of individuals and businesses are used to spur investments. It is further necessary that most of the currency in circulation is moving through the banks rather than being stored at various places in an unproductive manner. This will give banks the capacity to lend and also to bring interest rates down in order to spur investment and be competitive.

A study by MasterCard shows that the cost of using cash i.e. printing, transporting, storage, soiled notes, etc. is almost 1.5% of GDP. The move to ‘Digital’ transactions, through the Banking System will not only benefit the customer but also the economy through lowering of cost.

We also need to bring to semi-urban and rural India the convenience of dealing ‘Digitally’ and getting services/ loans at competitive rates.
We, at HDFC Bank, have been working to use Technology and Connectivity to provide you with the most convenient service at the best price. Specifically:

We have reduced our turnaround time (TAT) on all kinds of loans (Personal Loans, Auto Loans, Loans Against Shares, Consumer Durable Loans, etc.) to between 10 seconds to 3 hours. We have also made it convenient for you to apply through any access channel i.e. MobileBanking, NetBanking or the branch

We have developed products to make payments of all kinds most convenient. In fact it is more convenient to pay through us rather than Wallets. You first have to transfer money to a Wallet and then pay.

In our case you can pay at the click of a button:

Bills: Mobile, Electricity, DTH, Gas, Landline
Travel: Cabs, Bus, Train, Air
Entertainment: Movies and Dining
Shopping: Groceries, Apparel, Electronics, Home Appliances, etc.
All banking transactions: Pay salaries to employees, apply for loans, buy and sell shares, business transactions through ENet, Trade on Net and Mobile for trade transactions, SME portal for small and medium enterprises

Virtual relationship management available 24×7 over phone and through your mobile banking app.

Over and above all these, you can do all your banking transactions from the convenience of your own home. To do this follow three simple steps:
Step 1: Download our Mobile Banking app from Apple Store or Google Play Store or Windows App Store.
Step 2: Get started immediately by logging in with your Customer ID and Password known to you/ given to you by the bank. You could also set a quick access PIN on your own very easily.
Step 3: Get the power of the bank in your hands from quick links to all our apps- PayZapp, HDFC securities, Chillr, AutoPedia, InvestTrack and deals and discounts through SmartBuy.
Through over 125 transactions on the MobileBanking app and various other apps, you get access to world-class services, deals and discounts.
Please help us and help yourselves because you will not only get convenience (recognizing that going from one place to another in any city of any size involves pain and time), but also get some of the best prices for items purchased by you from the convenience of your home. Moreover if you use our card you will also get points which you can redeem for air tickets and other rewards of your choice.

Over and above all this, you are 100% safe and secure as our apps and digital products are designed with the most stringent security protocols using the latest security tools, so you can use them without worrying.

So here’s HDFC Bank bringing you convenience, at a competitive price, backed by robust processes, integrity and care for the customer.

I would like to conclude by saying that we must recognize the direction in which banking and payments is moving and it is in your interest, as well as, of all institutions and the country, to actively use ‘Digital’ services. If you’d like to know more about going Digital or for any queries/feedback please email us at [email protected]. Let us hope we are able to make your life simpler.

Warm regards,

Aditya Puri
Managing Director