India abolished banknotes last night without warning, triggering trading chaos in the country. As of midnight Wednesday, 500 and 1,000 rupee notes are no longer valid. Many ATMs are closed, and stores will no longer accept bank notes, which are the highest denominations in India. Even hospitals are reported to say no, even though they should have received an exemption from the flash operation.
The decision was announced late Tuesday night, just hours before it took effect. All 500 and 1,000 rupee notes must be exchanged in banks, and the idea is that this will attract large amounts of black-market money.
New 500 and 2,000 rupee notes are scheduled to be released on Thursday, but in a country with over a billion inhabitants, where very many manage all their business with cash, the changeover will be catastrophic.
“Life will be harder for everyone, from the poorest to the richest,” said the assessor Swaminathan Aiyar in the news channel ET Now.
In anticipation of the new banknotes reaching out is the highest denomination is 100 rupees (1.5 USD).