Cash Withdrawal Restriction Likely To Be Continued Beyond Dec.30

December 26 2016
Cash Withdrawal Restriction Likely To Be Continued Beyond Dec.30

Restrictions on withdrawal of cash from banks and ATMs are likely to continue beyond December 30 as currency printing presses and RBI have not been able to keep pace with the demand of new currency notes.

As the 50-day deadline for completion of demonetisation process draws near, there is a growing consensus among bankers that the restrictions on withdrawal would have to continue even in the New Year so as to maintain orderly working at the banks.

Banks at many places are not in a position to disburse even the current limit of Rs. 24,000 per week due to cash crunch and are rationing the valid currency depending on cash availability.

If this limit is withdrawn for individual and businesses from January 2, it is unlikely that banks would be able to disburse the higher demand for valid currencies given the current cash position.

After the demonetisation of high value Rs. 500/1000 notes, the government has fixed a limit of Rs. 24,000 per week on withdrawal from bank accounts and Rs. 2,500 per day from ATMs in view of the currency crunch that followed.

The government and RBI has not specified when the restrictions will be withdrawn. Finance Secretary Ashok Lavasa had said the withdrawal cap would be will be reviewed after December 30.

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