Several customers are now contemplating opening up new accounts in other banks.
There were cases of heated exchange between bank staff and customers, who failed to withdraw money.
On Thursday, the Reserve Bank of India (RBI) superseded the board of Yes Bank and imposed a 30-day moratorium after the Rana Kapoor-promoted bank failed to raise capital to address potential loan losses.
The bank''s depositors are allowed to withdraw cash up to Rs 50,000 from their accounts during the 30-day moratorium period, according to a government gazette.
The withdrawal limit, however, can be relaxed up to Rs 5 lakh in case of medical emergencies, higher education and for expenses related to marriages, it said.
The rush to withdraw money from the bank continued despite Finance Minister Nirmala Sitharaman, Chief Economic Advisor Krishnamurthy Subramanian and Reserve Bank Governor Shaktikanta Das trying to allay the fear among the depositors.
"Our salary gets credited on 21st of every month. I am a little worried about my upcoming salary as I have a salary account with Yes Bank. I am going to provide details of my other bank account to HR today so that my money doesn''t get blocked," said an MNC employee who was standing in a queue at one of the branches in suburban Mulund.
Pradeep Kumar, an engineer by profession, working with a large real estate developer, said, "I have some money right now but I have come to withdraw more since it is the beginning of the month and there are some payments lined up."
Kumar had tried to withdraw money yesterday night but ATM went dry before his turn came.
Yes Bank has 1,000 branches across the country.
To streamline the withdrawal process, some of the branches are giving limited tokens to the customers.
"The branch manager has refused to give me a token since I reached late. They are giving tokens to up to 130 people," said a customer who was seen fighting with the manager of the branch in suburban Mumbai.
Security was also tightened at the bank''s headquarters, its branches and ATMs across the city. It''s not just salaried customers, but entrepreneurs and small businessmen are also affected.
"We are a start-up having a current account with the bank. We recently raised money from investors which is lying in the account but we are unable to use it," said a customer who came to a branch in Powai to withdraw cash.
He said the company gave salaries to employees two days back but there are payments to be made to vendors.
"Our clients make payments to us which get deposited into our current account with the bank. We are now sending out communications to our clients not to make payments to our present account," said a visibly disturbed customer who has an IT hardware business.
Amidst all of this, she is also trying to get her current account open with other bank so that her clients can transfer the money.
One customer at the Kharghar branch said he hopes the country''s largest lender State Bank of India will not allow the bank to fail.
On Thursday, the SBI board gave its "in-principle" approval to exploring investment opportunities in Yes Bank.
The customers said even the mobile and internet banking are shutdown.
There was a posse of security men outside the RBI headquarters at Mint Road, which has experienced protests by depositors during the PMC Bank crisis in the recent past.
Diagonally opposite, at a Yes Bank branch, a huge stream of depositors could be seen queued up to withdraw their money.
At a bank''s branch in Colaba, there were similar scenes with a longish queue of depositors.
Yes Bank''s share tanked 56 per cent to end at Rs 16.20 apiece on the BSE on Friday.
While talking to reporters in New Delhi, the Finance Minister said she was in continuous interaction with the RBI who are fully seized of the matter and has assured for a quick resolution.
"I want to assure every depositor that their money shall be safe. Their monies are safe," she said.
The RBI Governor said the resolution of the bank will be done very swiftly.
"Thirty days which we have given is the outer limit. You will see a very swift action from RBI to put in place a scheme to revive Yes Bank," Das told reporters here.
Chief Economic Advisor Krishnamurthy Subramanian also said all options are under consideration for restructuring Yes Bank and assured that depositors'' money is safe.
This situation reminds one of the plights of depositors of Punjab and Maharashtra Cooperative Bank six months ago.
The customers of Mumbai-based urban cooperative bank also went through a similar hardships after the RBI, in September 2019, had superseded the board and the management of the bank.
The central bank had put a six-month regulatory restriction on the cooperative bank after it found out certain financial irregularities, hiding and mis-reporting of loans given to real estate developer HDIL.
The restriction included barring PMC Bank from lending and accepting fresh deposits. PTI HV BEN AA DC MKJ
Disclaimer :- This story has not been edited by Outlook staff and is auto-generated from news agency feeds. Source: PTI