The Reserve Bank of India removed the limits placed on cash withdrawals from current accounts, cash credit accounts, overdraft accounts…
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The Reserve Bank of India removed the limits placed on cash withdrawals from current accounts, cash credit accounts, overdraft accounts with immediate effect as a part of the remonetization drive that is pumping new cash into the economy.
“It has been decided to partially restore status quo ante,'' the Central Bank said in a circular aimed at all banks in the public and private sector, including regional rural banks, co-operative banks and foreign banks. “The limits of savings banks accounts will continue for the present and are under consideration for withdrawal in the near future.''
The circular said limits placed on cash withdrawals from ATMs will cease on February 1st.
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The RBI had placed severe restrictions on cash withdrawals from all accounts and ATMs as a part of the government's drive, launched on November 8, to clear illicit cash from the economy. Prime Minister Narendra Modi removed the legal tender status of the 1,000-rupee and 500-rupee notes, sucking out 86 percent of the currency float. Citizens and businesses were directed to deposit all such notes back into the banking sector. They could withdraw only minimal cash, subject to daily and weekly limits from accounts.
Overtime, the RBI diluted and eased withdrawal limits as fresh currency reached far flung banks and post offices. The bank has introduced new 500-rupee and 2,000-rupee notes in a bid to replace existing money supply.
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