The googly of Demonetization is getting difficult to read day by day.
The GOI and RBI earlier stated a per account cash withdrawal limit of Rs 10000 a day and Rs 20000 a week. After a few days, the esteemed organisations realized that if someone had to withdraw Rs 20000, he or she had to spend two whole days in queue. They adopted swiftly and banished the daily limit. The weekly limit was increased upwards to Rs 24000.
However, Rs 24000 a week was not all sufficient for some important occasions - like a wedding.
The GOI - after all, we, the nation have elected its members - moved in quick. They increased the limit to Rs 2,50,000 for wedding purpose. People who planned to celebrate a wedding in near future and planned to incur heavy expenses rejoiced.
And then this notification filters in.
2. With a view to enable members of the public to perform and celebrate weddings of their wards it has been decided to allow higher limits of cash withdrawals from their bank deposit accounts to meet wedding related expenses. Yet, banks should encourage families to incur wedding expenses through non-cash means viz. cheques /drafts, credit/debit cards, prepaid cards, mobile transfers, internet banking channels, NEFT/RTGS, etc. Therefore, members of the public should be advised, while granting cash withdrawals, to use cash to meet expenses which have to be met only through cash mode. Cash withdrawals shall be subject to the following conditions:
i. A maximum of ₹ 250000/- is allowed to be withdrawn from the bank deposit accounts till December 30, 2016 out of the balances at credit in the account as at close of business on November 08, 2016.
ii. Withdrawals are permitted only from accounts which are fully KYC compliant.
iii. The amounts can be withdrawn only if the date of marriage is on or before December 30, 2016.
iv. Withdrawals can be made by either of the parents or the person getting married. (Only one of them will be permitted to withdraw).
v. Since the amount proposed to be withdrawn is meant to be used for cash disbursements, it has to be established that the persons for whom the payment is proposed to be made do not have a bank account.
The line in bold stunned me.
Assume the below.
a) Someone had Rs 5 Lakhs in his/her account on 1st Nov 2016
b) The person withdraws 4 Lakhs on 5th Nov 2016, in cash, to manage his upcoming wedding expenses.
c) Rs 500 and Rs 1000 cease to be legal tender on 8th Nov 2016.
d) The person goes back to the bank to deposit (full or part) of Rs 4 Lakhs after the Demonetization.
e) This person now cannot withdraw this Rs. 4 Lakhs ( or Rs 2.5 Lakhs as per the limit set by GOI and RBI) again, since his balance was Rs 1 Lakh on 8th Nov 2016.
This is mind boggling.
People in India save their entire life to celebrate the wedding of their children. Such a move hurts them badly. It will crash dreams of many a people.
Demonetization has turned into a shame !
P.S. Notwithstanding the benefits of Demonetization, such rules will hurt people.
Googly of Demonetization Reviewed by Vyankatesh on Monday, November 21, 2016 Rating: