Update: As of February 1, 2017, the daily withdrawal limit for a Savings Account has been raised from Rs 10,000 to Rs 24,000 per week and for Current Account from Rs. 50,000 to Rs. 1 lakh.For more information, refer to the updated article.
The Reserve Bank of India recently announced that the daily withdrawal limit at automated teller machines has been raised from Rs 4,500 to Rs 10,000 per card. Although the overall cap of Rs 50,000 per week for current accounts is still in place, this major change to the daily limits comes as a relief to the post demonetisation cash crunch as currency supplies begin to increase. A raise in savings account weekly withdrawal limits is also said to be up for discussion from the current cap of Rs 24,000 to a possible cap of Rs 36,000 or even Rs 40,000 as the supply of new Rs 500 notes has continued to improve.
With new Rs 2,000 and Rs 500 notes having been issued, ATM machines had to be recalibrated to take them, which further added to the cash shortage and the heightened the anxiety of all customers alike. It is said that with currency presses now working around the clock and bank branches holding enough currency to service customers at the counters to accommodate for the fact that several ATM’s in the national capital region are still struggling to keep up with demand, cash supplies have begun to improve. RBI is also working on security features for the previously denied new Rs 1,000 note, which will likely be the same size as either the new Rs 2,000 note or the new Rs 500 note so that the ATM machines do not need to go through recalibration once again.
Image Source: The Economic Times
Despite the raise in withdrawal limits and the ongoing efforts to relieve the cash shortage situation however, RBI has faced a great deal of criticism over the poor planning that led to the shortages in the first place and there is still much speculation on whether or not the major issue of cash hoarding will continue as citizens remain anxious for the possibility of future shortages. It is said that almost Rs 14 lakh crore of the old Rs 500 and Rs 1,000 notes has come back to banks in the form of deposits which may indicate that the panic is beginning to ease and people aren’t holding onto cash, but that’s not to say that with the cap increases and the freedom to make larger withdrawals, people wont begin to withdrawal more to hold on to as a safety precaution, reversing the progress that has been made towards relieving the currency shortages as a whole.