Flight cancellations trigger chaos as grounded flyers turn to rails, roads, hotels

Flight cancellations trigger chaos as grounded flyers turn to rails, roads, hotels


Passengers wait at the airport as IndiGo’s flight disruptions continue at Kempegowda International Airport

Receiving a flight cancellation notification opens a Pandora’s box. For those who can afford to postpone their plans, delay is an option. But for many others, travelling for work, weddings or emergencies, there is little room to manoeuvre. With airfares skyrocketing and alternative flights priced steeply due to capacity shortages, a growing number of passengers are abandoning the skies and switching to trains and buses to stay on the move.

businessline spoke to travellers who scrambled to find alternative routes to reach their destinations in time.

Nandini Nachiyar (name changed), a Chennai-based tech professional travelling to Bengaluru, said trains were her first choice once she received a cancellation alert from IndiGo. “I didn’t want to risk rescheduling again with IndiGo, it was a challenging experience. I immediately booked Vande Bharat back to Chennai as I had to report for work,” she said.

This is not an isolated case. Rahul G Das, a Bengaluru-techie, who switched from flying to a long-haul bus journey, summed it up: “You just can’t shell out that much money for a ticket, and the rates are equivalent or more than some of the international routes.”

Hotel players

For Hrithika, travelling from Kanpur to Bengaluru, there were barely any alternatives. Her flight was cancelled just four hours before departure. Tatkal train tickets were unavailable, and only one weekly train operates on the route. “The bus takes almost 40 hours, so we had to extend our stay in Kanpur and shift travel to Sunday,” she said.

Passengers like Hrithika have also become unexpected customers for hotel chains, particularly properties located near airports. Amit Raman, General Manager, Radisson Blu Pune Hinjawadi, told businessline that cancellations have triggered an immediate rise in last-minute bookings. “We’ve seen a 25-30 per cent increase in same day and next day reservations, pushing occupancy up by roughly 10-12 percentage points. The average daily rate (ADR) has also moved up moderately due to sudden demand,” he said. Most stranded travellers are opting for mid-segment hotels for comfort and convenience, while premium rooms are being picked by families and corporate crews. The typical stay duration, however, remains just one night.

Airport micro-markets, including Aerocity in Delhi, GMR Hyderabad Airport and Kempegowda Bengaluru, are experiencing the greatest strain, as travellers prefer staying close to terminals to coordinate re-bookings. Airlines, Raman said, are informally reaching out for blocked inventory, though formal tie-ups are limited and handled case by case.

Echoing the trend,Pranav Maheshwari, co-founder, Stay Vista, said there has been a significant spike in last-minute bookings near key airports in Goa, Delhi, and Bengaluru as travellers prioritise shorter, drivable stays amid uncertainty.

Transport networks are also ramping up capacity. The Railway Ministry has added coaches on Rajdhani and Shatabdi routes, with Southern Railway adding one coach in 28 trains to meet demand. businessline has also learnt that additional outstation trains are being planned starting from Mumbai from Saturday for passengers. Additionally, 14 trains are likely to be operated from Mumbai. Indian Railways will also deploy 116 extra coaches across 37 trains to ease travel disruptions from flight cancellations.

As travellers improvise and reroute, one thing is clear: the fallout from mass flight cancellations has spilled beyond aviation.

With inputs from Chennai, Hyderabad, Mumbai.

Published on December 5, 2025



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Rupee: RBI’s effort has always been to reduce any abnormal or excessive volatility, says Guv Malhotra

Rupee: RBI’s effort has always been to reduce any abnormal or excessive volatility, says Guv Malhotra


The RBI’s stated policy has always been that it allows the market to determine the Rupee’s value and it does not target any price level or band, according to Governor Sanjay Malhotra.

The aforementioned observation comes in the backdrop of the Rupee breaching the 90 to the Dollar mark a couple of days back.

“We believe that the markets in the long run are very efficient. It is a very deep market. We saw this earlier in February — the rupee to dollar had climbed up to almost 88 and within a period of three months, it came back to below 84,” the governor said at a post monetary policy press meet.

The governor emphasised that fluctuations in USD/INR, volatility does happen and can happen.

“Our effort has been always to reduce any abnormal or excessive volatility and that is what we will continue to endeavour. Our external sector, as I also mentioned in my statement, is very strong…,” Malhotra said.

India’s current account deficit moderated from 2.2 per cent of GDP in Q2:2024- 25 to 1.3 per cent in Q2:2025-26 on account of robust services exports and strong remittances.

Malhotra noted that healthy services exports coupled with strong remittance receipts are expected to keep CAD modest during 2025-26. As on November 28, 2025, India’s foreign exchange reserves stood at US$ 686.2 billion, providing a robust import cover of more than 11 months.

“Overall, India’s external sector remains resilient. We are confident of meeting our external financing requirements comfortably,” he said.

The governor underscored that India has sufficient reserves; the current account is very manageable at about 1 per cent or so.

“And given the strong fundamentals of our country, we should get good capital flows…So, I think, we are in a very comfortable situation in so far as the external sector position is concerned,” he said.

Published on December 5, 2025



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PhonePe shuts Pincode’s B2C arm, pivots to B2B solutions

PhonePe shuts Pincode’s B2C arm, pivots to B2B solutions


Pincode has been reducing offerings and has exited categories such as fashion and electronics to focus on hyperlocal and high-frequency segments such as food and grocery, Moneycontrol reported in April 2024. 
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MURALI KUMAR K

Pincode, a hyperlocal shopping app of PhonePe, is winding down its business to consumer (B2C) vertical, which also offered deliveries in 15-30 minutes and will focus on expanding its B2B (business to business) Solutions for offline shops, said the company in its statement.

Sameer Nigam, PhonePe founder & Group CEO said, “Pincode’s mission is to empower Indian offline shop keeper with advance technology solutions to help them grow their businesses and remain competitive against new age e-commerce and quick commerce companies. To this end, operating yet another B2C quick commerce app ourselves was distracting us from our core mission which is to help offline business partners achieve operational efficiency, improved margins and visibility and growth in their existing offline business.”

Pincode has been reducing offerings and has exited categories such as fashion and electronics to focus on hyperlocal and high-frequency segments such as food and grocery, Moneycontrol reported in April 2024.

It moved travel and transited to the main PhonePe app. This comes at a time when the company is preparing for its IPO.

Vivek Lohcheb, CEO of Pincode added, “As part of this strategic decision, we will now focus the entire Pincode team’s resources towards accelerating the build out and scale up of a suite of B2B business solutions for offline businesses across India. Pincode already provides inventory management, order management and other ERP solutions to businesses, and is offering B2B direct sourcing and replenishment solutions for certain categories.”

Published on December 5, 2025



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RBI’s repo cut to aid consumption, investment and funding cost, bankers say

RBI’s repo cut to aid consumption, investment and funding cost, bankers say


The Reserve Bank of India’s (RBI) 25 basis points (bps) repo rate cut will support consumption, investment, and reduce funding costs for corporates, according to senior bankers.

State Bank of India (SBI) Chairman CS Setty said the decision to cut rates while keeping the door open for further easing helps cushion the economy against unexpected shocks or external headwinds.

“The move reinforces the structural drivers of a ‘higher-for-longer’ growth trajectory across investment, credit and consumption,” he said.

He added that concurrent liquidity-management steps are designed to anchor money-market rates and lower borrowing costs. “Together, the rate cut, neutral stance and targeted liquidity interventions aim to sustain economic momentum while safeguarding price and financial stability.”

Housing, MSMes to gain

Indian Overseas Bank MD & CEO Ajay Kumar Srivastava said the rate cut is expected to ease borrowing costs, spur demand in housing and real estate, support MSMEs and sustain growth in personal and auto loans.

“Bank credit growth remains healthy at 11 per cent, and overall credit from bank and non-bank sources has grown 13.1 per cent. The RBI’s ₹1 lakh crore OMO purchases and the 3-year USD/INR buy-sell swap will support liquidity and monetary transmission. These steps will encourage domestic investment and deepen financial access,” he said.

long-term swap

Manappuram Finance MD & Chairman V.P. Nandakumar noted that with price pressures stabilising and liquidity improving, the move aims to lift consumption and investment at a time when growth momentum has moderated. Lower policy rates typically reduce borrowing costs for home loans, autos, MSME credit and working-capital financing, helping households and small businesses manage cash flows more comfortably, though full transmission may take a few weeks.

He added that the introduction of the three-year rupee-dollar sell swap adds another layer of support. “By infusing longer-term liquidity without unsettling short-term rates, the RBI is ensuring banks have room to lend more comfortably. This should help lower funding costs further and improve liquidity conditions for both consumers and small businesses.”

“From a wider economic standpoint, the cut strengthens the pro-growth environment. Bond yields generally soften, credit demand improves, and sectors heavily dependent on financing — such as real estate, autos and NBFCs — stand to benefit from lower EMIs and better borrowing conditions,” he said.

Published on December 5, 2025



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RBI grants in-principle approval to Fino Payments Bank for conversion to a small finance bank

RBI grants in-principle approval to Fino Payments Bank for conversion to a small finance bank


Fino Payments Bank net revenue rose 26 per cent to ₹118 crore

The Reserve Bank (RBI) today granted ‘in-principle’ approval to Fino Payments Bank for conversion into a Small Finance Bank (SFB). businessline was the first to report in August that the regulator will likely approve Fino’s request for SFB conversion.

The RBI had issued the guidelines for ‘on tap’ licensing of SFBs in the private sector. Per the norms, existing payments banks which are controlled by residents and have completed five years of operations are eligible for conversion into SFBs. The application of FPBL was assessed as per the procedure laid down in the guidelines, the regulator said.

Earlier this year, the RBI granted in-principle approval to AU SFB to convert into an universal bank and returned the application of Jana SFB to convert into an universal bank. Ujjivan SFB, too, had applied for universal bank license and its application is pending with the regulator.

With Fino’s exit, there are only few operational and large scale payments bank in the country. These include Airtel Payments Bank, Jio Payments Bank and India Post Payments Bank. Paytm Payments Bank was barred by the RBI from accepting fresh deposits and conducting any new activity due to material violation of regulatory norms. The ban, imposed in 2018, continues to exist till date.

The payments bank model came into being essentially to aid underserved population in hinterlands conduct transactions. However, with rising digital transactions, and the RBI’s rules that say payments banks cannot lend and cannot accept more than ₹2 lakh from each depositor, experts say the model is no longer sustainable.

“When the idea was conceived, it was clear the these entities will make money out of payments and remittances. That is the reason they were allowed to accept only ₹1 lakh as deposit from each customer, whose limit was later raised to ₹2 lakh. But after that model was introduced, demonetisation came into effect, UPI transactions perked up, digital transactions rose as per government’s guidance,” former RBI deputy governor R Gandhi told businessline in a previous interaction.

“So, the revenue model is now flawed for payments bank, there is no money there so how will they succeed. Payments banks cannot sustain in their current state. They must be allowed to convert into a SFB,” he added.

“This approval provides Fino, an opportunity to realise its growth potential by expanding product suite, engaging with a wider customer segment, foray into lending and building a strong liability franchise thereby creating significant value for all stakeholders,” said Rishi Gupta, MD and CEO, Fino Payments Bank.

Fino will continue to leverage its asset-light, distribution-led network while investing in technology, data and partnerships to build scale.

Published on December 5, 2025



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Focus now on policy rate cut transmission: RBI Governor

Focus now on policy rate cut transmission: RBI Governor


**EDS: THIRD PARTY IMAGE** In this screengrab from a video posted on Dec. 5, 2025, Reserve Bank of India (RBI) Governor Sanjay Malhotra speaks as he announces the fifth bi-monthly monetary policy for the current fiscal, in Mumbai. (@reservebankofindia593/X via PTI Photo) (PTI12_05_2025_000036B)
| Photo Credit:

Having cumulatively reduced the benchmark policy repo rate by 125 basis points (bps) since he took charge, Reserve Bank of India (RBI) Governor Sanjay Malhotra will now focus that transmission of repo rate occurs in broader markets. In a post monetary-policy committee (MPC) press conference, Malhotra talks about the RBI’s approach towards a depreciating rupee, aspired inflation target and the regulator’s conscious effort to repatriate gold stored in foreign countries to India. Edited excerpts:

Does the lower inflation forecast leave further space to support growth?

Whether there is more space (to cut repo rate) going forward, we are neutral today. We believe the important thing is that inflation has been benign. It has been around 3-3.5 per cent in the last two years, if you exclude the food component which has been volatile. And going forward too, if you exclude gold and silver, our expectation is that it will remain benign. Now whether that opens up policy for further rate cuts — that will be speculation. The more important thing now is having reduced repo rate by further by 25 basis points (bps), we have to concentrate on transmission. Considering that inflation is expected to be benign, I think let it first transmit into the real economy and then we will see how growth and inflation dynamics behave and we will take decisions policy by policy.

Is the rupee undervalued. What is the RBI’s approach to a depreciating currency?

Our stated policy has always been that we don’t target any price levels or bands. We allow markets to determine prices. Markets, in the long run, are efficient. We saw this earlier in February when the Rupee climbed up to almost ₹88 per US dollar, and within three months it came back below ₹84. So these fluctuations and volatility can happen. Our effort has been to reduce abnormal or excessive volatility, and we will continue to endeavour. Our external position is very strong. Going forward, we believe we have sufficient reserves, the current account deficit is very manageable, and given strong fundamentals, we will get good capital flows. So we are in a very comfortable position as far as the external sector is concerned.

Is consumer demand not picking up, which is leading to such a low level of inflation?

0.2 per cent is not the right level of inflation. We target 4 per cent. At the same time, I don’t think we should be looking at 0.2 per cent because there are going to be fluctuations, volatility in markets — whether it is forex, equity or prices in general. Some of the impacts are also because of base effects. Earlier, we had very high food inflation and now because of the base effect it seems to be low. But underlying inflation is certainly on the lower side, which is why we chose to cut the repo rate.

Will banks lower deposit rate post repo cut?

We have to look at real interest rates, when inflation is so low and going forward too, it is going to be low. Even though the nominal interest rate may seem low today, real rates are quite high. That is true not only for borrowers but also savers. So we do expect post today’s repo cut, deposit rates will moderate to a certain extent.

Is the RBI consciously repatriating physical gold stored in foreign countries to India?

We are diversifying. It is not good to store all gold at one place.

Interest rates on fresh rupee loan have increased. Bond yield also have not fell by the same degree as repo. Is transmission a challenge?

Interest rates have risen on the lending side in the last two months. As mentioned, the interest rate effect is now 79 bps.But if the proportion of higher-interest loans like unsecured loans and gold loans rises, then the average interest rate goes up. It does not mean that transmission has slowed. The number you should be looking at is the interest rate effect — whether interest rates have come down or not for different segments of loans. If the share of higher-yielding loans rises, the average interest rate rises, even though interest rates on each segment have come down.

On bond yields, the primary target we have is our operating target, and then it transmits to various other interest rates, including bond yields. If you compare bond yields now versus earlier and the spreads, they are more or less similar. Spreads are not higher. Please keep in mind, when the policy rate is lower, the spread will be higher. You cannot expect the same spread at a 6.50 per cent repo rate and a 5.50–5.25 per cent repo rate. Historically, if you look at spreads when the repo rate was at 5–5.15 per cent, the spreads today are not very different; they may, on average, have been a little lower than they were earlier. Bond yields follow the long-term policy rate path. That is one factor, but primarily it is all about demand and supply. Earlier, we had created excess supply through OMOs, which pushed yields down.

Published on December 5, 2025



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