People have queued up outside banks across India to exchange 500 and 1,000 rupee notes after they were withdrawn as part of anti-corruption measures.
Indians will be able to exchange their old notes, which stopped being legal tender at midnight on Tuesday, for new ones at banks until 30 December.
The surprise move is part of a government crackdown on corruption and illegal cash holdings.
Banks were shut on Wednesday to allow them enough time to stock new notes.
There are also limits on cash withdrawals from ATMs.
There were chaotic scenes outside banks in Mumbai and Delhi.
The BBC’s Geeta Pandey in Delhi says some banks extended working hours to deal with the rush, and have hired extra staff on a temporary basis.
Bank officials told the BBC that they also brought in extra cash to deal with the situation, and things had gone smoothly apart from the fact that the police had to be called in to deal with sporadic fights that broke out among customers.
Vijay Karan Sharma from Chhattisgarh, a student at Delhi University, told the BBC he had been standing in a queue since morning.
“I went home for Diwali and my parents gave me money as a gift. Now, instead of studying, I have been standing here,” he said.
“I wish they had a simpler system for students. I desperately need cash to pay my rent and buy books and food.”
Meanwhile, Indian social media has been talking of little else.
The top trend on Twitter India has been #CashCleanUp with tweets ranging from the frustrated to the humorous, as many Indians came to terms with the fact that much of their day would be spent in queues.
New 2,000 (about $30; £24) and 500 rupee denomination notes with new security features are being given to people to replace those removed from circulation.
A new 1,000 rupee note “with a new dimension and design” will also be introduced in due course, a senior government official said on Thursday.
The move is designed to lock out money that is unaccounted for – known as “black money” – which may have been acquired corruptly, or is being withheld from the tax authorities.
Finance Secretary Shaktikant Das warned people with large amounts of hidden cash that banks would closely monitor the exchange of old notes for new ones.
The government says the move will flush out tax evaders and that all old notes deposited in banks will be subjected to tax laws.
How long have people got to change their old notes?
The 500 ($7; £6) and 1,000 ($15; £12) rupee notes are the highest denomination notes in the country and are extremely common in India. Airports, railway stations and hospitals will only accept them until 11 November.
People will be able to exchange their money at banks between 10 November and 30 December.
How much ‘black money’ is there in circulation?
The actual figure is unclear but correspondents say the issue of “black money” is a huge problem in India. The idea here is to lock out money that is unaccounted for and make it visible for tax purposes – banks will be happy to exchange a few thousand rupees, but will be asking questions of those who turn up with hundreds of thousands or millions in currency.
Is there a limit on the amount an individual or household can cash in?
It seems not. An individual can put as much as he or she likes into the bank – but withdrawals are limited so the banking system may end up being flooded with cash.
Government guidelines say it is possible to exchange up to 4,000 rupees per day up to 24 November. People can also withdraw up to 10,000 rupees from a bank per day and a maximum of 20,000 rupees per week.
How will overseas Indians exchange banknotes?
Overseas Indians can deposit the banknotes in their non-resident rupee denominated accounts.
What will foreign tourists carrying the banknotes do?
They can purchase foreign exchange equivalent to 5,000 rupees using these bank notes at airport exchange counters until midnight on Friday.