Wedding cash allowed, exchange amount cut

TT, New Delhi, Nov. 17: The Centre today drove down the cash exchange limit and allowed families with upcoming weddings and farmers to withdraw more money, accepting feedback about distress as well as misuse after the decision to recall notes.

Old notes can be exchanged for only up to Rs 2,000 from Friday, the government said, lowering the limit of Rs 4,500 that had been raised from the initial Rs 4,000 only four days ago.

Cash exchange is said to be the biggest cause of the long queues outside banks. After the government decided to mark the fingers of those exchanging notes, the pressure appeared to have eased a bit today but the queues were still visible and cash ran out fast in several ATMs.

"Reports have been received that the same persons are going back to the counter again and again, thereby cornering the facility and depriving many other people from exchanging old notes. There are also reports of organised groups indulging in such practices to convert their black money into white," the finance ministry said in a statement.

The ministry said the option of Rs 2,000 could be used only once and was being allowed "for convenience of the people who may be on temporary visit for work or otherwise".

Economic affairs secretary Shaktikanta Das said: "There is enough cash available with the government. This (lowering the currency exchange limit) is mainly to enable a larger number of people to reach the counter...."

Asked if the government is scaling up the printing of 100-rupee notes, Das said: "Notes have been printed as per action plan.... People are working in three shifts, so full capacity production is going on."

The finance ministry statement said the new operational decisions had been taken after considering various suggestions, including some from state governments.

Each family organising a wedding can withdraw up to Rs 2.5 lakh in cash from their KYC-compliant bank accounts. Till now, the largest one-time withdrawal was limited to Rs 24,000 a week.

"The amounts can be drawn only by either of the parents or the person getting married. Only one of them will be permitted to draw this amount. This limit of Rs 250,000 will apply separately to the girl's family and the boy's family," the ministry said.

"The person drawing the amount has to furnish the PAN details. A self-declaration will have to be submitted by the person to the effect that only one person from his/her family is drawing the amount.... Any misuse of this facility will invite appropriate action based on the self-declaration and other details," the ministry added.

Farmers have been allowed to access up to Rs 50,000 per account per week. Farmers who have taken a crop loan or have the Kisan Credit Card can withdraw Rs 25,000 per week from their loan accounts or the Kisan card. Farmers who have got payments through RTGS or cheque deposits with KYC-compliant bank accounts can withdraw an additional Rs 25,000 a week.

Traders registered with APMC markets will be allowed to draw up to Rs 50,000 a week from their KYC-compliant accounts as in the case of business entities.

The last date for payment of crop insurance premium has been extended by 15 days.

Central government employees up to Group C and equivalent levels in defence and paramilitary forces, railways and central public sector enterprises have been given an option to draw a salary advance of up to Rs 10,000 in cash. This will be adjusted against their salary for November.

Petrol pump cash

The government tonight decided to allow petrol pumps to dispense Rs 2,000 in cash to customers against a swipe of their debit cards in SBI machines. Only 2,500 fuel outlets in the country have point-of-sale (PoS) machines from the SBI. PoS machines are the ones generally used for debit or credit card transactions.

A meeting has decided that an amount up to Rs 2,000 in cash can be dispensed per day per person against the swipe of a debit card at a petrol pump where a PoS machine of the SBI is already available.