Demonetisation: Govt says RBI may lift limits on ATM cash withdrawal soon

RBI is likely to lift the weekly limit on cash withdrawals from savings accounts in banks, said economic affairs secretary, Shaktikanta Das. “RBI to soon take a call on lifting weekly withdrawal RBI to soon take a call on lifting weekly withdrawal limit; only few withdraw Rs 24,000 a week or Rs 96,000 a month from savings bank account,”Das told PTI.

The Reserve Bank of India (RBI) is likely to lift the ATM cash withdrawal limits from savings accounts, economic affairs secretary Shaktikanta Das said on Friday.

The demonetisation process led to acute cash crunch in India, with many analysts and rating agencies predicting that the economy will shrink given its reliance on cash transactions. (AFP)

Das told PTI that the central bank will soon take a call on lifting the weekly limit of Rs 24,000.

The RBI on January 31 lifted curbs on branch withdrawals from current, cash credit and overdraft accounts. It also announced that from February 1, people would be allowed to withdraw from ATMs Rs 24,000 from their savings accounts in one go. But, it kept the weekly limit for such accounts unchanged.

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“..Only a few withdraw Rs 1 lakh a month. Therefore, effectively and practically today, there is no restriction. I think the process of remonetisation is near-complete. I am using the word near-complete because this Rs 24,000 limit is there,” Das told PTI in an interview.

The government recalled 500 and 1,000-rupee banknotes on November 8 in a shock announcement that sucked out 86% of the currency in circulation, sparking a severe cash crunch and panic among billions of Indians.

The limits on cash withdrawals were imposed after the scrapping of high-value banknotes. These limits, however, were gradually eased with the RBI pumping in new notes of Rs 500 and Rs 2,000.

HT recently reported that the government might allow people to withdraw their weekly limit of Rs 24,000 in a single ATM transaction, as the cash crunch situation showed signs of easing nearly three months after the demonetisation exercise.

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