Last week India withdrew 85 per cent of the hard currency from its cash-dependent economy, even though replacement notes were not yet ready.

That has caused immense hardship, particularly among the poor. They have turned on the Government and especially the Prime Minister, who jetted to Japan as the crisis unfolded.

So why was it done, and could the pain have been avoided?

Last night, an emotional Indian Prime Minister Narendra Modi defended the move, which the Government said was aimed at fighting corruption, tax evasion and counterfeiting.

Mr Modi begged Indians to endure the pain until the year's end, telling them he would "accept any punishment" from them otherwise.

"Give me time till December 30," Mr Modi said

"If you find any shortcomings, mistakes or any wrong intention on my part, I will be ready to face any punishment from you."

It is a rare acknowledgement of political mortality from India's leader, and came as the Government admitted disruption would last weeks, because of delays in note printing and technical issues fitting them into ATMs.

With long, increasingly angry queues remaining outside banks over the weekend, officials also moved to alleviate some of the stress by raising strict withdrawal limits.

What is the plan all about?

Last Tuesday evening, Mr Modi announced that 500 and 1000 rupee banknotes ($10/$20), would no longer be legal tender as of midnight.

The idea behind the snap withdrawal was to rid the economy of so called "black money" by rendering ill-gotten gains suddenly worthless.

To exchange the old notes for new ones at banks, people must show ID, and transactions over $5,000 are scrutinised by the taxman.

Everyone the ABC spoke to that evening pledged support, despite acknowledging the difficulty it would cause.

"It is good for our country," one man said, moments after a stallholder had refused his 500 rupee note.

"This will benefit our economy," said another, as he stood in line to withdraw still-legal 100 rupee ($2) notes from an ATM.

The move to abolish the notes has caused chaos for businesses. ( Reuters: Jayanta Dey )

What has changed?

Fast forward nearly a week, and anger has replaced patience.

Arguments and scuffles are breaking out in bank and ATM queues which stretch for hours, forcing people to skip work to obtain money.

Trade in fruit, vegetables and food staples, usually all done in cash, is down 60 per cent.

Many shops are closed and lots of people are genuinely worried about having enough to eat.

Several instances of people looting groceries have been reported.

The poor are hardest hit. According to a World Bank report last year, 45 per cent of Indians still do not have bank accounts, so depend entirely on cash.

"The Modi Government should have thought above the move and kept things under control," one man said.

"The common people are facing a lot of inconvenience, and it comes at a time when there is marriage season and crop season for farmers, and imagine, you have to stand in queues for the whole day, leaving your businesses and jobs, just for [the daily limit of] 4,000 rupees ($80)."

Why such chaos?

Because the Reserve Bank of India had simply not printed anywhere near enough new money when the move was announced, 23.7 billion notes — valued at $337 billion — were rendered worthless.

Yet only now, six days after withdrawing the economy's most valuable banknotes, is the RBI beginning to distribute replacement 500 rupee bills.

It is not yet clear when replacement 1000 rupee notes will be issued.

Anyone who endures the bank queues and finds a bank with bills can obtain two new 2000 rupee notes per day, but shopkeepers will not accept them unless customers buy goods worth that much, because no-one wants to give up the scarce still-legal 100 rupee notes.

Sanjiv Kumar Sood, an officer at a Punjab National Bank told the ABC that his branch in suburban Delhi was allocated only 50,000 rupees ($5000) in 100 rupee notes.

"They only gave me five bundles," he said. "They ran out by lunchtime."

Could it have been done differently?

The Government said it could not print all the new money in advance, for fear of the plan leaking to those it was designed to target.

On Saturday, India's Finance Minister Arun Jaitley said increasing the supply of 100 rupee notes as an interim measure would have been too obvious.

He also said because the new notes were different size, it would take weeks for ATMs to be reconfigured.

"ATMs could not have been calibrated [before the announcement] because of secrecy issue," he said.

"Thousands of people are involved ... and secrecy could not have been maintained. Recalibration takes at least two to three weeks."

But opposition politicians are questioning the Government's motivation. Political campaigns in India are widely acknowledged as being awash with black money, and two critical state contests are scheduled early next year.

One of the Prime Minister's most trenchant critics, Delhi Chief Minister Arvind Kejriwal, has even alleged that associates of the ruling Bharatiya Janata Party knew of the impending move, and purchased gold or property ahead of the announcement.

Booming deposits indicate the Government's plan is working, allowing them to regulate the cash. ( Reuters: Danish Siddiqui )

Is it working?

Despite the political cost, booming deposits indicate the plan is having the desired effect, bringing cash into banks where officials can regulate it.

Finance ministry officials said people have deposited the equivalent of $59 billion of the now-defunct currency since Tuesday's announcement.

On the flipside, people are resorting to creative and illegal work-arounds.

One temple worker has been caught on camera offering to use religious organisations' tax exempt status to launder money for a commission, by depositing money into its accounts and returning it later.

Finance officials were also examining a sudden surge in deposits into dormant accounts previously created under a rural financial literacy drive.

In the long term, economists said the plan would be fiscally successful if India's pitifully low tax take increases and more business moves into the regulated economy.

More difficult to measure is whether fear of a repeat in future will deter corruption or tax evasion.

Perhaps with that in mind, Mr Modi last night indicated his Government had more planned.

"This is not a full stop," Mr Modi said.

"I am saying it openly that this is not a full stop. I have several projects in my mind to eradicate corruption."