RBI Relaxes Cash Withdrawal Limits

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The Reserve Bank of India (RBI) has notified that if deposits had been made in legal tender, then depositors could withdraw that amount over and above the Rs.24,000 weekly limit.

The move is aimed at allowing comfort to individuals who were hesitant to deposit legal tender following the withdrawal of high-value currency notes which came into effect from November 9.

The withdrawals could be preferably permitted in available higher denominations bank notes of Rs.2,000 and Rs.500.

The move will encourage small businesses such as shopkeepers to deposit cash in legal tender which they can fully withdraw.

According to RBI Rs.8.1 lakh crore had been deposited in banks following the demonetisation move (as of November 27) while close to Rs.34,000 crore had been exchanged.

Background:

Following the withdrawal of high-currency notes, the Centre had said that an individual could only withdraw Rs.24,000 in cash per week.

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.

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