With banks closed in many parts of the country, cash-strapped citizens have been lining up outside ATMs since early morning but with limited success as most machines are running dry.
Scuffles and heated exchanges were reported from ATMs and banks in many parts of the country.
Many sections of society, including small traders, restaurant owners, and transporters, among others who primarily operate in a cash economy, have started feeling the heat of PM Modi's demonetization move.
Meanwhile, asserting that the poor in the country are supporting his decision, Modi took on Opposition parties, particularly the Congress, saying it is the corrupt who are sleepless now.
"After demonetization, the poor are enjoying a sound sleep while rich are running from pillar to post to buy sleeping pills," Modi said at BJP's Parivartan Yatra in Goa on Sunday, as he continued to rally public support for his move.
Scoffing at the Opposition for blaming him for problems being faced by the poor, the PM said he was better aware of the hardships being faced by commoners. "You (Congress) issue statements. I feel the pulse of the poor," he said.
Modi said the action will affect very powerful people people but he is prepared to fight for the poor.
"I know I will face a lot of hardships as those having lots of cash are very powerful people but I have undertaken this fight for the poor," the PM said.