RBI ends limits on withdrawals from ATMs and Current Accounts

Mumbai: The Reserve Bank of India or RBI today said it has lifted a limit on daily cash withdrawal from current accounts, cash credit accounts and overdraft accounts with immediate effect. It said restrictions on ATM withdrawals would be lifted from Wednesday, February 1. Curbs on withdrawing cash from savings bank accounts would however continue for now and are “under consideration for withdrawal in the near future,” the central bank said.

– Limits placed vide the circulars cited above on cash withdrawals from Current accounts/ Cash credit accounts/ Overdraft accounts stand withdrawn with immediate effect.

–The limits on Savings Bank accounts will continue for the present and are under consideration for withdrawal in the near future.

–Limits vide the circulars cited above placed on cash withdrawals from ATMs stand withdrawn from February 01, 2017. However, banks may, at their discretion, have their own operating limits as was the case before November 8, 2016, subject to 2 (ii) above.

It means that from Wednesday, savings accounts holders will no longer be restricted to being allowed to withdraw only 10,000 rupees in a single transaction. They will be able to withdraw Rs. 24,000 at one go at an ATM. However, because curbs on Savings accounts haven’t been lifted yet, they cannot withdraw any more money all that week thereafter.

There will be no curbs anymore for current accounts, cash credit accounts and overdraft accounts over the counter or from ATMs.

Withdrawal of money from bank accounts was curbed amid a massive cash crunch that followed Prime Minister Narendra Modi’s sudden announcement on November 8 last year scrapping 500 and 1000 rupee notes.

The move, aimed at eliminating corruption and black money took out 86 per cent of the cash in circulation at the time or about 15.44 lakh crore. The RBI has said it is printing new currency at break neck speed to overcome the shortage of cash.

The RBI chief Urjit Patel earlier this month told a parliamentary panel that the central bank has issued Rs. 9.2 lakh crore of new currency, thus replacing 60 per cent of demonetised currency.

The RBI had initially set a cash withdrawal limit of Rs. 50,000 from current accounts which was later increased to Rs. 100,000 a day.