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Cash crunch woes: Notes swap limited from Rs. 4500 to Rs. 2000

While long queues continue to form outside banks and ATMs the government today announced another set of measures to ease the huge cash crunch after the sudden currency ban last week. Farmers and families organizing weddings have got some reprieve in the latest announcement.

The limit for swapping old Rs 500 and Rs 1000 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 to Rs 4,500 just four days ago, a measure that was welcomed by many as it would mean less visits to the bank.

Families can withdraw Rs 2.5 lakh for weddings but only from one account, based on self-declaration. Also 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.

Traders in vegetable wholesale markets have been allowed to withdraw Rs 50,000 a week now to pay for expenses like wages.

Rs 25,000 a week can be drawn from payment that farmers receive for agricultural produce in form of cheques.