50 days of demonetisation: What all happened
Since then the government has made many rules, some to comfort the people, some to scare the money hoarders, but most of them ended up fuelling confusion. Here's a list of five major announcements during demonetisation that scared the common man
- Dec 28, 2016,
- Updated Dec 30, 2016 9:58 AM IST
Fifty days and the memories of demonetisation quake is still afresh. On November 8, the note ban was announced and created the situation of immense chaos. Since then the government has made many rules, some to comfort the people, some to scare the money hoarders, but most of them ended up fuelling confusion. Here's a list of five major announcements during demonetisation that scared the common man 1. Restriction limit on cash withdrawal When the note ban was announced, the government also set rules that notes upto Rs 4,000 could only be exchanged over the counter in banks and just Rs 2,000 could be withdrawn from banks. After reviewing the situation, the Finance Ministry asked banks to increase exchange limit over the counter from Rs 4,000 to Rs 4,500.
Also, weekly limit of Rs 20,000 for withdrawal from bank accounts was increased to Rs 24,000, and limit of Rs 10,000 per day was removed. The new limit for withdrawals from ATM was set at Rs 2,500.
2. Rs 2.5 lakh deposit Deposit limit for housewives was set at Rs 2.5 lakh, and people depositing above Rs 2.5 lakh would be scrutinised by the I-T department. On November 10, the government also warned that cash deposits above Rs 2.5 lakh from November 8 till December 30 could attract tax with a 200 per cent penalty in case of income mismatch. However, the government assured that small businessmen, housewives, artisans and workers who had some cash lying as their savings at home should not be worried. 3.Wedding woesThe currency ban announcement came during the wedding season in the country. And the restrictions on cash created panic among families who had weddings planned. The government took stock of the situation and announced that for wedding ceremonies, amount up to Rs 2.5 lakh could be withdrawn from bank accounts that were KYC-compliant. However, a PAN card and self-declaration application was made mandatory during the withdrawal.
The government also said that only one member of the family was allowed to withdraw money.
4. Deposits over Rs 5,000 allowed only once per bank account On December 19, the Reserve Bank of India in a notification said that an individual depositing Rs 5,000 or above into their bank accounts would have to provide a "satisfactory" explanation to three bank officials. It further said that deposits in excess of Rs 5000 could only be made once, until December 30. However, RBI cleared that these rules would not be applied to deposits made in favour of Pradhan Mantri Garib Kalyan Yojana 2016. The reasons cited in the notification was that the decision was implemented to place restrictions on deposits of banned notes into accounts while encouraging the deposits of the same under the Taxation and Investment Regime for the Garib Kalyan Yojna.
But after a huge uproar, RBI rolled back the decision and fully exempted KYC-compliant bank accounts from the above two conditions.
ALSO READ: Demonetisation: What could change after December 30
Fifty days and the memories of demonetisation quake is still afresh. On November 8, the note ban was announced and created the situation of immense chaos. Since then the government has made many rules, some to comfort the people, some to scare the money hoarders, but most of them ended up fuelling confusion. Here's a list of five major announcements during demonetisation that scared the common man 1. Restriction limit on cash withdrawal When the note ban was announced, the government also set rules that notes upto Rs 4,000 could only be exchanged over the counter in banks and just Rs 2,000 could be withdrawn from banks. After reviewing the situation, the Finance Ministry asked banks to increase exchange limit over the counter from Rs 4,000 to Rs 4,500.
Also, weekly limit of Rs 20,000 for withdrawal from bank accounts was increased to Rs 24,000, and limit of Rs 10,000 per day was removed. The new limit for withdrawals from ATM was set at Rs 2,500.
2. Rs 2.5 lakh deposit Deposit limit for housewives was set at Rs 2.5 lakh, and people depositing above Rs 2.5 lakh would be scrutinised by the I-T department. On November 10, the government also warned that cash deposits above Rs 2.5 lakh from November 8 till December 30 could attract tax with a 200 per cent penalty in case of income mismatch. However, the government assured that small businessmen, housewives, artisans and workers who had some cash lying as their savings at home should not be worried. 3.Wedding woesThe currency ban announcement came during the wedding season in the country. And the restrictions on cash created panic among families who had weddings planned. The government took stock of the situation and announced that for wedding ceremonies, amount up to Rs 2.5 lakh could be withdrawn from bank accounts that were KYC-compliant. However, a PAN card and self-declaration application was made mandatory during the withdrawal.
The government also said that only one member of the family was allowed to withdraw money.
4. Deposits over Rs 5,000 allowed only once per bank account On December 19, the Reserve Bank of India in a notification said that an individual depositing Rs 5,000 or above into their bank accounts would have to provide a "satisfactory" explanation to three bank officials. It further said that deposits in excess of Rs 5000 could only be made once, until December 30. However, RBI cleared that these rules would not be applied to deposits made in favour of Pradhan Mantri Garib Kalyan Yojana 2016. The reasons cited in the notification was that the decision was implemented to place restrictions on deposits of banned notes into accounts while encouraging the deposits of the same under the Taxation and Investment Regime for the Garib Kalyan Yojna.
But after a huge uproar, RBI rolled back the decision and fully exempted KYC-compliant bank accounts from the above two conditions.
ALSO READ: Demonetisation: What could change after December 30