Outside the Churchgate branch of the Bank of India in south Mumbai, some of those queueing for cash have become familiar faces.

Ever since the prime minister, Narendra Modi, unexpectedly withdrew high-value 500- and 1,000-rupee banknotes from circulation, wiping out 86% of India’s currency overnight, queueing for cash has become a national sport. But for some, such as Santosh Garg, who comes here every day on behalf of his bosses at an insurance company, lining up has become a part of his job description.

“Obviously I don’t like coming and standing in line for two hours in the sun,” Garg says. “I do it because my boss tells me to. It’s not like I can say no.”

Modi’s money crunch has prompted an unexpected boom in the queue-sitting business, where people are paid to stand in line. Some people send their employees to hold their place, while others hire workers paid by the day to do the job. Tech startups such as BookMyChotu and DoneThing have also swooped in to capitalise on the queueing crisis, offering “helpers” who will hold your place in a bank queue for 90-150 rupees (£1-£1.75) an hour. The proxies wait until they are close to the head of the queue then call their temporary employer, who makes the transaction.

But the cash-for-queueing business is controversial. Some of those who have waited for two hours outside the bank near Churchgate argue that sending someone to hold your place in a queue is unethical and unfair to those who have no choice but to come themselves. Prathamesh Shroff, who has come to withdraw 12,000 rupees, says: “Everyone should do their own work. If you support Modi’s decision, you should show your support by coming here and standing in the queues with the rest of us.”

Some of India’s elite, such as the film star Ravi Babu, who queued for 15 minutes at a cash machine in Hyderabad holding a live piglet, have joined the crowds themselves. But most of the better-off have left the queueing to others.

Actor Ravi Babu queues outside an ATM in Hyderabad with a piglet. Photograph: Ravi Babu/Facebook

In the Churchgate bank queue, Teresa Gonzalves says the country would grind to a halt if rich businessmen stopped working to stand in queues. “What’s wrong with sending someone in your place?” she asks. “I’m not going to get paid if my boss doesn’t have money to pay me. Rich men are not going to come and stand here. If our bosses come, the country will stop working. They have work to do too.”

Gonzalves’s view is surprisingly common in India, where paying for a line-sitter is being hailed as a form of jugaad, an Indian concept meaning creative corner-cutting. Jugaad implies that following the rulebook too rigidly is the act of a fool. While British colonisers saw a natural justice in the random orderliness of first come, first served, decades of bureaucratic inefficiency in post-independence, socialist India fostered a love for innovative rule-bending.

Queue-sitting is only one of many such shortcuts that Indians are taking to circumnavigate the cash crisis. Cash-rich Indians started thinking up ingenious ways to dispose of their high-value notes as soon as Modi announced their withdrawal on 8 November.

That night, a waiter at the stylish Umame restaurant in south Mumbai, was asked by a regular if he could pay 100,000 rupees in high-value notes before the note ban kicked in, as an advance for his next 10 meals at the restaurant. The following day, first-class tickets for India’s longest train journey between Dibrugarh and Kanyakumari were sold out for the next four months as people scrambled to buy expensive tickets with their notes, planning to get refunds later in small change or new currency.

Employers are offering, sometimes forcing, employees to accept advance salaries for the next six months in old 1,000- and 500-rupee notes. Others are buying gold, and taking backdated receipts from jewellers who can claim that purchases in high-value notes were made before Modi’s announcement. Mobile and electronic payments have surged, and cash-free, app-based taxi services and online grocery markets have seen a dramatic increase in customers. A small number of restaurants, gyms and bars are offering to take old notes, which can still be exchanged at banks until the end of 2016.

Queueing for pay is not a new concept in India, nor in other parts of the world. In New York, a place in a queue for a free public theatre performance can come for $125. In top Beijing hospitals, coveted doctor’s appointments, which can be subject to months-long waiting lists, can be bought from line-standers. Free-market economic theory suggests that there is nothing wrong with paying to take someone’s place in a queue if both parties agree.

But with the note shortage in India, cash is precious and the queue-jumping jugaad has a dark side. As banks quickly run out of cash, many have to go hungry if they cannot make it to the front of the line. Others have to take days off work to wait in line. One man, standing in the queue at the bank, who does odd jobs for a launderette, says he will phone his boss when he reaches the front, so that he can come and make a cash deposit. “Every man, whether he’s rich or poor, has a mouth to feed. But somehow, only ordinary folks like us end up standing in line,” he says.