After facing severe flak for its controversial rule on cash deposit restrictions, Reserve Bank of India (RBI) reverses the limit partially for all KYC accounts holders.
In its 59th joint communication with the Finance ministry, RBI restricted the people from depositing over Rs 5000 in old banknotes more than once till December 30.
The step was initiated to reduce the bank queues. The banks were advised to conduct due diligence regarding the reasons for not depositing these notes earlier.
As per the recent announcement, the relaxation will apply to “fully Know Your Customer (KYC) compliant accounts”. KYC pertains to customer information details.
In a message sent to all banks, the RBI said it had reviewed its instructions and decided that the rule will not apply to KYC-compliant accounts.
In an effort to fight the menace of ‘black money’, the Prime Minister announced the recall of Rs 500 and Rs 1,000 notes. Since then, there have been off and on changes to banking rules to manage the transition.
The banned notes can be deposited in banks till December 30 and thereafter at the select RBI counters till March 31.
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