Last week a man walked into a Nairobi car yard and paid for a luxury Mercedes with a mountain of 1,000 shilling ($10) banknotes, desperate to offload cash that within days would be worthless.

With a deadline looming before the Central Bank of Kenya bans all old edition 1,000 shilling notes, big fish with their fortunes stashed in cash are under pressure to find ways to jettison their money.

A new print of the 1,000 shilling banknote, <a href="https://www.wionews.com/world/kenya-launches-new-bank-notes-and-retires-old-1000-shilling-banknote-to-stem-illicit-flows-223995">the largest denomination</a>, was rolled out in June, with Kenyans given to September 30 to exchange their old bills at the bank or be stuck with bundles of useless cash.

The operation is aimed at flushing out dirty money being hoarded by tax evaders, crooked businessmen and criminal groups.

Large deposits of the old notes, embossed with the image of Kenya's founding father Jomo Kenyatta, raise alarm bells at banks and require paperwork to prove their origin.&nbsp;

The central bank in June said there were roughly 218 million 1,000 shilling notes in circulation, but declined to say what proportion was being stashed as black money.&nbsp;

Kenyan economist Aly-Khan Satchu said devaluing these bills works by "taking its owners by surprise".&nbsp;

"Four months is a short period of time when you want to launder big sums of money," he said.

"People who have that money will definitely try to save what they can", he added.

Car Wash

So people are getting creative, devising schemes to quickly unload small amounts of their cash while avoiding detection by the authorities.

John, a car dealer <a href="https://www.wionews.com/india-news/five-indian-nationals-killed-due-to-floods-in-kenya-247127">in Nairobi</a>, recalled his customer last week counting out thousands upon thousands of banknotes to purchase a luxury car worth $74,000.

"People want to get rid of their old notes, but they know very well that questions will be asked if they go put the money themselves in the bank," said John, who declined to offer his real name due to the nature of his business.

"When I go to the bank to deposit money from a car sale, people ask for the papers from the sale, sometimes even copies of emails, but it never goes further."

Other businesses are finding a lucrative side trade in washing 1,000 shilling notes through their tills -- for a bit in return.

"I was approached by a friend through another friend and we struck a deal. I get around 500,000 shillings every day to the bank together with my daily sales," said a liquor shop owner who declined to be named in Hurlingham, a district near downtown Nairobi.

"In return I get between five and 10 per cent, depending on the amount."

The amounts being deposited are below one million shillings, the threshold at which banks required detailed paperwork under a new transparency policy imposed by the central bank in June 2018.

Gentlemen's agreement

One canny businessman in western <a href="https://www.wionews.com/world/kenyas-high-court-unanimously-upholds-ban-on-gay-sex-221423">Kenya</a> dished out his cash in the form of small, interest-free loans of around 50,000 shillings.&nbsp;

The amounts are low, so those exchanging the old bills avoid detection, and upon returning the debt his money is cleaned into new bills.

"Nothing is written down, it is a gentleman's agreement," he said, declining to be named.

Other methods involve sinking cash into real estate or investment funds, or businesses moving large volumes of money, several businesspeople told AFP.

But it's not all underhanded and hush-hush.

One bar in the coastal city of Mombasa is offering to swap banknotes on behalf of drinkers, encouraging punters to spend big at their "Old Notes Send Off Party" being held the eve of demonetisation.

Last week a man walked into a Nairobi car yard and paid for a luxury Mercedes with a mountain of 1,000 shilling ($10) banknotes, desperate to offload cash that within days would be worthless.

Last week a man walked into a Nairobi car yard and paid for a luxury Mercedes with a mountain of 1,000 shilling ($10) banknotes, desperate to offload cash that within days would be worthless. With a deadline looming before the Central Bank of Kenya bans all old edition 1,000 shilling notes, big fish with their fortunes stashed in cash are under pressure to find ways to jettison their money. A new print of the 1,000 shilling banknote, the largest denomination, was rolled out in June, with Kenyans given to September 30 to exchange their old bills at the bank or be stuck with bundles of useless cash. The operation is aimed at flushing out dirty money being hoarded by tax evaders, crooked businessmen and criminal groups. Large deposits of the old notes, embossed with the image of Kenya's founding father Jomo Kenyatta, raise alarm bells at banks and require paperwork to prove their origin. The central bank in June said there were roughly 218 million 1,000 shilling notes in circulation, but declined to say what proportion was being stashed as black money. Kenyan economist Aly-Khan Satchu said devaluing these bills works by "taking its owners by surprise". "Four months is a short period of time when you want to launder big sums of money," he said. "People who have that money will definitely try to save what they can", he added. Car Wash So people are getting creative, devising schemes to quickly unload small amounts of their cash while avoiding detection by the authorities. John, a car dealer in Nairobi, recalled his customer last week counting out thousands upon thousands of banknotes to purchase a luxury car worth $74,000. "People want to get rid of their old notes, but they know very well that questions will be asked if they go put the money themselves in the bank," said John, who declined to offer his real name due to the nature of his business. "When I go to the bank to deposit money from a car sale, people ask for the papers from the sale, sometimes even copies of emails, but it never goes further." Other businesses are finding a lucrative side trade in washing 1,000 shilling notes through their tills -- for a bit in return. "I was approached by a friend through another friend and we struck a deal. I get around 500,000 shillings every day to the bank together with my daily sales," said a liquor shop owner who declined to be named in Hurlingham, a district near downtown Nairobi. "In return I get between five and 10 per cent, depending on the amount." The amounts being deposited are below one million shillings, the threshold at which banks required detailed paperwork under a new transparency policy imposed by the central bank in June 2018. Gentlemen's agreement One canny businessman in western Kenya dished out his cash in the form of small, interest-free loans of around 50,000 shillings. The amounts are low, so those exchanging the old bills avoid detection, and upon returning the debt his money is cleaned into new bills. "Nothing is written down, it is a gentleman's agreement," he said, declining to be named. Other methods involve sinking cash into real estate or investment funds, or businesses moving large volumes of money, several businesspeople told AFP. But it's not all underhanded and hush-hush. One bar in the coastal city of Mombasa is offering to swap banknotes on behalf of drinkers, encouraging punters to spend big at their "Old Notes Send Off Party" being held the eve of demonetisation.

Oncoming cash ban forces Kenyans to swap banknotes

India&#39;s economy will likely grow at its slowest pace in four years this fiscal year, a Reuters poll showed, as a currency ban and the new goods and services tax (GST) have disrupted business activity and dampened consumer demand.

Asia&#39;s third-largest economy will grow at 6.7 per cent in the fiscal year ending March 2018, the slowest since the <a href="http://www.wionews.com/preview/article/22763">new methodology of measuring gross domestic product (GDP)</a> was introduced in the 2014-15 fiscal year, according to the latest poll of 30 economists.

The poll was taken on October&nbsp;12-24, closing just before India announced a<a href="http://www.wionews.com/preview/article/22820"> $32.43 billion plan to </a><a href="http://www.wionews.com/preview/article/22820">recapitalise</a><a href="http://www.wionews.com/preview/article/22820"> state banks,</a> a bid to tackle a major drag on the economy.

While the latest poll&#39;s number for this year matches the International Monetary Fund&#39;s toned-down forecast - that was 7.2 percent earlier - it is a sharp decline from 7.3 percent the July Reuters poll showed.

But despite the broad and marked slowdown expected in economic activity, India&#39;s projected growth rate will be second to the world&#39;s fastest-growing major economy - China - if predictions are met.

A majority of economists said the risk to their already lower outlook for Indian growth this fiscal year is skewed further to the downside as stressed corporate balance sheets prevent a recovery in private capital spending and mounting bad loans at Indian banks remain a burden.

All but three of 23 respondents who answered an extra question said the government had imposed too many sweeping changes for the economy in a short period of time, referring to demonetisation and the GST, and that has lowered growth expectations.

&quot;Demonetisation was unnecessary and had a huge disruptive effect. Even before the economy could recover from that shock, came (the) GST,&quot; said Kunal Kundu, vice president and India economist at Societe Generale.

&quot;More importantly, the government was not prepared adequately enough, thereby transmitting further shock to the slowing economy.&quot;

Prime Minister Narendra Modi&#39;s decision last November to scrap high-value old banknotes wiped out about 86 per cent of currency in circulation virtually overnight in an economy which is largely cash-based.

That has hurt consumer spending, which powers more than half of the $2 trillion economy.

But just when some improvement in data raised hopes that the impact of the cash clampdown had been absorbed, confusion among businesses on pricing goods and services after the July 1 implementation of GST has impacted activity.

The economy grew at 5.7 percent annually in the April-June quarter, its lowest level in more than three years and well below expectations.

However, nearly three-fourths of 23 respondents who answered an extra question said India does not need a stimulus package and instead should focus on fiscal discipline which is vital for investment from outside the country to flow in.

&quot;There is limited scope for any stimulus when the budget fiscal deficit projections will anyways be breached on account of revenue shortfall,&quot; said Abhishek Upadhyay, economist at ICICI Securities Primary Dealership.

Despite bleak growth expectations, the Reserve Bank of India is forecast to keep key policy rates on hold through mid-2019, focusing on anchoring inflation.

The latest Reuters poll predicted retail inflation to average 3.5 percent this fiscal year, unchanged from the July median but below the RBI&#39;s medium-term target of 4.0 per cent.

Inflation was expected to average 4.5 percent in 2018-2019, compared to 4.3 per cent in the previous poll.

&quot;With inflation trending up directionally and RBI&#39;s insistence on 4 percent target on a durable basis, a convincing case for a rate cut appears less plausible,&quot; said Madhavi Arora, economist at Kotak Mahindra Bank.

The poll was taken on Oct. 12-24, closing just before India announced a $32.43 billion plan to recapitalise state banks, a bid to tackle a major drag on the economy.

India's economy will likely grow at its slowest pace in four years this fiscal year, a Reuters poll showed, as a currency ban and the new goods and services tax (GST) have disrupted business activity and dampened consumer demand. Asia's third-largest economy will grow at 6.7 per cent in the fiscal year ending March 2018, the slowest since the new methodology of measuring gross domestic product (GDP) was introduced in the 2014-15 fiscal year, according to the latest poll of 30 economists. The poll was taken on October 12-24, closing just before India announced a $32.43 billion plan to recapitalise state banks, a bid to tackle a major drag on the economy. While the latest poll's number for this year matches the International Monetary Fund's toned-down forecast - that was 7.2 percent earlier - it is a sharp decline from 7.3 percent the July Reuters poll showed. But despite the broad and marked slowdown expected in economic activity, India's projected growth rate will be second to the world's fastest-growing major economy - China - if predictions are met. A majority of economists said the risk to their already lower outlook for Indian growth this fiscal year is skewed further to the downside as stressed corporate balance sheets prevent a recovery in private capital spending and mounting bad loans at Indian banks remain a burden. All but three of 23 respondents who answered an extra question said the government had imposed too many sweeping changes for the economy in a short period of time, referring to demonetisation and the GST, and that has lowered growth expectations. "Demonetisation was unnecessary and had a huge disruptive effect. Even before the economy could recover from that shock, came (the) GST," said Kunal Kundu, vice president and India economist at Societe Generale. "More importantly, the government was not prepared adequately enough, thereby transmitting further shock to the slowing economy." Prime Minister Narendra Modi's decision last November to scrap high-value old banknotes wiped out about 86 per cent of currency in circulation virtually overnight in an economy which is largely cash-based. That has hurt consumer spending, which powers more than half of the $2 trillion economy. But just when some improvement in data raised hopes that the impact of the cash clampdown had been absorbed, confusion among businesses on pricing goods and services after the July 1 implementation of GST has impacted activity. The economy grew at 5.7 percent annually in the April-June quarter, its lowest level in more than three years and well below expectations. However, nearly three-fourths of 23 respondents who answered an extra question said India does not need a stimulus package and instead should focus on fiscal discipline which is vital for investment from outside the country to flow in. "There is limited scope for any stimulus when the budget fiscal deficit projections will anyways be breached on account of revenue shortfall," said Abhishek Upadhyay, economist at ICICI Securities Primary Dealership. Despite bleak growth expectations, the Reserve Bank of India is forecast to keep key policy rates on hold through mid-2019, focusing on anchoring inflation. The latest Reuters poll predicted retail inflation to average 3.5 percent this fiscal year, unchanged from the July median but below the RBI's medium-term target of 4.0 per cent. Inflation was expected to average 4.5 percent in 2018-2019, compared to 4.3 per cent in the previous poll. "With inflation trending up directionally and RBI's insistence on 4 percent target on a durable basis, a convincing case for a rate cut appears less plausible," said Madhavi Arora, economist at Kotak Mahindra Bank.

Cash ban, GST disruptions to pull down India's GDP growth: Poll

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