Mumbai: In a bid to discourage cash hoarding, RBI on Tuesday relaxed norms on withdrawal limits stating that those who deposit legal tender currency notes with banks would be allowed to withdraw money beyond the current limits.
The move is aimed at addressing the shortage of cash with banks that has impeded the smooth exchange and withdrawal of cash under the prescribed limit at several banks and ATMs across the country following the demonetisation of old Rs 500 and Rs 1,000 notes.
“It has been reported that certain depositors are hesitating to deposit their monies into bank accounts in view of the current limits on cash withdrawals from accounts. As it is impeding active circulation of currency notes, it has been decided, on careful consideration, to allow withdrawals of deposits made in current legal tender notes on or after November 29, 2016 beyond the current limits,” RBI said in a notification.
However, RBI added that higher denominations new bank notes of Rs 2,000 and Rs 500 would be issued for such withdrawals.
Since the announcement of the withdrawal of high denomination currency notes, the general public had deposited or exchanged Rs 8.44 lakh crore as on November 27 with exchange amounting to Rs 33,948 crore and deposits amounting to Rs 8.11 lakh crore.
According to RBI, public have also withdrawn Rs 2.16 lakh crore from their accounts either over the counter or through the ATM’s.
Centre not looking to extend deadline
The government on Tuesday said sufficient cash is available with RBI and banks, and it is not considering extending the deadline of December 30 for deposit of invalid Rs 500 and Rs 1,000 notes.
The statement was made in the Rajya Sabha even as people queued up at banks to deposit old high value notes and withdraw new cash.
“There is sufficient cash available with the Reserve Bank of India and banks. Circulation of notes in respect of Rs 100 has already been increased,” Minister of State for finance Arjun Ram Meghwal said.
On whether the deadline will be extended, he said, “No such proposal for extension of deadline beyond December 30, 2016, is presently under consideration of the government.”
