Govt reduces exchange limit to Rs 2K, families with weddings can get Rs 2.5L

The government has reduced the limit on exchanging banned banknotes to Rs 2,000 from Friday, announcing a raft of new measures to help people tide over a chaos triggered by the surprise recall of high-value currencies last week.

Economic affairs secretary Shaktikanta Das told reporters on Thursday that families with weddings can withdraw Rs 2.5 lakh. They will have to sign a self-declaration document saying the money was drawn against only one account – that of the father, mother, groom or the bride.

The earlier limit of the one-time exchange of the old banknotes was Rs 4,500.

“There is enough cash available with the government. This (reducing currency exchange limit) is mainly to enable larger number of people to reach the counter... We find that many people are not able to reach the counter and same persons are visiting the counter multiple times and other people are not getting the benefits,” Das said.

Select bank branches across metro cities have already started applying indelible ink on the right hand index finger of people who are exchanging notes.

The government has struggled to dispense cash to millions of Indians who have lined up to exchange or deposit their old currency after a shock recall of Rs 500 and Rs 1,000 notes last week.

The new measures came even as the government said there was no question of a rollback of the demonetisation move and there was enough cash to meet demand.

“Some 22,500 ATMs will be recalibrated today (Thursday) to allow withdrawal of Rs 100, Rs 500 and the Rs 2,000 notes. Nearly 200,000 ATMs exist as of now,” finance minister Arun Jaitley said, according to IANS.

Sources said that less than 40,000, or a little over 18%, of the country’s ATMs have been configured to use the new notes.

The new Rs 2,000 note has a new size, weight and design – which the ATMs are not programmed to dispense.

Resetting an ATM is a three-to-four-hour process. An official at a private firm explained that if the new target of resetting 16,000 ATMs a day is met, it will take two weeks to complete the task for machines across the country.

Read| Non-compliant currency: ATMs may take 2-3 weeks to become fully functional

A task force under Reserve Bank of India (RBI) deputy governor SS Mundra was set up on Monday to monitor the recalibration exercise. The task force has decided to segregate machines based on their location. ATMs near hospitals will be accorded “priority status”.

“We are closely monitoring the recalibration exercise and things should settle down in the next few weeks. The task force is also reviewing the situation on a daily business,” Rituraj Sinha, president, Cash Logistics Association and a member of the task force, told HT.

The Centre also permitted central government employees up to Group C categories to withdraw Rs 10,000 in cash against their November salary.

For farmers, it relaxed withdrawal limits to Rs 25,000 a week on their agri-loan accounts in addition to Rs 25,000 that they receive on selling their produce.

“Agriculture is an important component. We are at the commencement of the Rabi season. We want to ensure farmers get smooth supply of fertilizers and other items,” economic affairs secretary Das said.

(With agency inputs)

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