Hundreds queued up at banks and ATMs since Thursday morning to withdraw cash on payday.

People rushed to the banks with several government departments and corporate houses crediting salaries of employees on the first day of the month.

Bank customers could withdraw cash after waiting for three to four hours in queues. The rush at banks went up with many ATMs still not dispensing cash even 23 days after the demonetisation was announced.

Nanhak Rajak, an employee of the finance department, had to take a half-day leave to withdraw his salary from the State Bank of India's (SBI) Secretariat branch.

Still in queue, Rajak said: "I had come to withdraw my salary. I have queued up since 10.30am but it's 1pm now and I am still here. I guess that I have to wait for another half-an-hour to reach the cash counter. With salary being credited to our accounts today, I had informed my immediate senior stating that I will withdraw my salary, guessing it would take half-an-hour."

If Rajak had pain in queuing up for more than three hours, Mohan Kaber, a retired finance department employee, reached the same branch around 10.30am to withdraw his pension. But he too had to wait for long hours and sat down on the floor in the absence of seating arrangement for senior citizens.

Kaber said: "The bank has arranged only one queue for senior citizens. It should have arranged for more."

If there was rush of people inside banks to withdraw cash from counters, the scene outside the bank ATMs was no different.

The ATM at the SBI Secretariat branch was shut for more than two hours owing to technical glitches. There was a long queue of people outside the ATM hoping that they would withdraw cash once the ATM started functioning.

Shashi Bhushan Choudhary, assistant general manager (SBI Secretariat) branch, said: "We do not have any cash storage as we have our currency chest in the bank. Though the rush of people has risen, everyone will get cash."

The SBI Secretariat branch, with around 50,000 customers, largely caters to government employees working at the secretariat and even high court employees. Though cash was not a problem at SBI, many other banks suffered cash shortage in morning.

UCO Bank at Raja Bazaar, which had ran out of cash on Wednesday, had to wait till 12.30pm to get cash from its currency chest. Similarly, Punjab National Bank (PNB) in Ashiana too had to wait for cash from its currency chest for disbursing cash to its customers.

The bank received the cash around 2pm, with many customers in morning leaving without cash.

UCO Bank manager Prashant Kumar said: "We received the cash around 12.30pm but the amount was much less than the actual requisition." Bank sources said the bank had demanded Rs 50 lakh from its currency chest but received only Rs 20 lakh.

Sources said cash crunch was also in rural areas. At Parsa Bazaar of rural Patna, customers staged a road blockade at Daroga Rai Path over cash shortage at the SBI Parsa Bazaar branch. However, it was lifted after supply of cash from the currency chest.

However, the RBI denied any cash shortage.

Manoj Kumar Verma, regional director, Bihar and Jharkhand, said: "We have increased the cash flow over the past two days, focusing on payment of salaries and pension. There is no shortage of cash." According to the RBI, the bank supplies 550 boxes of currency notes to different banks across the state every day. Each box contains 1 lakh pieces of currency of different denominations ranging from Rs 100, Rs 500 to Rs 2,000.

However, the scene at private sector banks was different. At HDFC Bank on Exhibition Road, there was a rush of people but the bank had opened a "Corporate Client" counter for its customers.

An official at the branch, preferring anonymity, said: "We have set up a separate Corporate Client counter, which will function in the first week of December."

Apart from long queues of people at bank counters, many ATMs in state capital had board of no cash or were not working due to technical glitches. Banking sources said only 60 per cent were functioning.

People standing in ATM queues complained of disbursal of only Rs 2,000 against the Rs 2,500-limit fixed by RBI.

Ankur Kedia, standing at the Axis Bank ATM on Exhibition Road, said: "The RBI has fixed the withdrawal limit of Rs 2,500 from ATMs, but it is disbursing only Rs 2,000."