Government Limits Notes Exchange to Rs. 2,000, Starting November 18

NEW DELHI (TIP): India government announced, November 17, new measures to help farmers and families planning weddings withdraw more money from banks amid a massive cash crunch after the sudden ban on high value currency last week. Prime Minister Narendra Modi has reviewed cash availability and the steps taken to ease hardship in a meeting with Finance Minister Arun Jaitley and the officials.

The limit for swapping notes at banks has been reduced from Rs. 4,500 to Rs. 2,000 for each person from Friday. Economic Affairs Secretary Shaktikanta Das said this would give more people a chance to exchange banned Rs. 500 and Rs. 1,000 notes. The withdrawal limit was raised from Rs. 4,000 just four days ago, a measure that was welcomed by many as it would mean less trips to the bank.

Finance Minister Arun Jaitley said, November 17, 22,500 ATMs would be recalibrated today, allowing them to dispense new notes. There are around 2 lakh ATMs across the country.

Families can withdraw Rs. 2.5 lakh in one go for weddings but only from one account, based on self-declaration. In the wedding season, the notes ban has led to a severe crisis for families who had withdrawn cash in bulk just before the demonetization.

Farmers can withdraw up to Rs. 25,000 a week against loans sanctioned to them to buy seeds and fertilizers and credited to their accounts. Rs. 25,000 a week can be drawn from payment that farmers receive for agricultural produce in form of checks. The time limit for the payment of insurance premium on crop loan has been extended by 15 days.

Traders in vegetable wholesale markets can withdraw Rs. 50,000 a week to pay for expenses like wages.

The Reserve Bank has reiterated that there is sufficient supply of notes “consequent upon increased production which started nearly two months ago”. It asked the people not to panic or hoard currency notes.

Government employees will have the option to draw salary advance in cash.

National Highways will not collect toll tax till November 24 midnight.

The government’s sudden decision to pull out the high value currency notes from circulation to check black or untaxed money has driven people to wait for hours at banks and ATMs for cash.

Since November 8, the government has announced more measures to reduce the pressure on people, amid opposition allegations that it was a poorly planned move.