Banking

12 things that emerged from Modi’s demonetisation review meeting

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500-and-1000-noteAmidst severe criticism from the Opposition and a section of discontented citizens, Prime Minister Narendra Modi chaired a high-level meeting late on Sunday to take stock of the demonetisation process.

As per official sources, the meeting went on till 2 am on Sunday night to review the supply and availability of cash in banks and post offices.

According to the sources, Modi was informed about the steps taken to improve the supply of cash.

Also present in the meeting were Finance Minister Arun Jaitley and Reserve Bank of India (RBI)  Deputy Governor.

Modi held extensive discussions on cash limits, plans of reaching in rural areas and deadlines.

Earlier, Home Minister Rajnath Singh and Finance Minister Arun Jaitley had reviewed the current situation in India in the wake of demonetisation of Rs 1,000 and Rs 500 notes. In their meeting, the ministers were briefed about the situation in various states where the heavy rush was witnessed in banks and ATMs to change old notes and withdraw cash.

Union Home Secretary Rajiv Mehrishi and other top officials of the Ministries of Home and Finance had also attended the meeting.

Meanwhile, leaders of the Opposition parties (Congress, TMC and Left) also called a meeting on Monday at 4 pm to discuss the demonetisation issue.

According to Shaktikanta Das, Secretary of Department of Economic Affairs, 12 important decisions that were taken during Sunday’s high-level meeting are:

1) The banks have been advised to increase the cash holding limit of the banking correspondents to at least 50,000 rupees. In other cases, banks would be encouraged to increase the cash holding limits beyond 50,000 rupees in appropriate cases.

2) The reach and distribution of cash, especially in rural areas, will improve substantially.

3) Banking correspondents to be permitted by banks to draw cash in a single day multiple times.

4) To expedite process asap,task force being set up under the chairmanship of RBI Dy Governer, it will have representatives of banks as its members. It also has representatives of the department of financial services and the ministry of home affairs as their representatives. This task force has been instructed to work out a strategy to expedite the whole process of recalibration of the ATMs.

5) In the meantime, the micro ATMs will be deployed in a large number of areas to dispense cash against debit and credit cards.

6) Current account business entities which have an operational current account during last 3 months will be permitted to draw Rs 50,000 at a time.

7) The ATM limit also has been increased to 2,500 rupees with respect to the recalibrated ATMs. In other words, ATMs which are recalibrated to dispense new Rs500 or Rs 2000 notes, they can dispense 2,500 at a time.

8) It has been decided that all govt departments and central public sector undertakings will maximise their e-transactions.

9) RBI advised national payments corporation of India to waive its transaction charges on old transactions which are settled through the financial switch. This facility will available until 31st December. Banks also being advised to waive their charges for various kinds of transactions.

10) Annual life certificate which pensioners are required to submit during November, the time limit for that extended till January 15 next year.

11) There will be separate queues for senior citizens and differently-abled persons. There will be separate queues in banks for those who are visiting only to exchange old series of notes with new notes.

12) Currently, the government has given exemption to a certain category of transactions where old series of Rs 500 and 1,000 notes can be accepted. The limit for such transactions is being extended from 14th November midnight to 24th November midnight.

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