RBI raises withdrawal limit from Rs 1,000 to Rs 10,000 for PMC Bank customers

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RBI raises withdrawal limit from Rs 1,000 to Rs 10,000 for PMC Bank customers

The central bank has hiked withdrawal limit to Rs 10,000 from Rs 1,000.

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In a relief to the crisis-hit Punjab & Maharashtra Cooperative (PMC) Bank customers, the Reserve Bank of India today increased the withdrawal limit from Rs 1,000 to Rs 10,000.

“Other terms and conditions of the said Directive shall remain unchanged. With the above relaxation, more than 60% of the depositors of the Bank will be able to withdraw their entire account balance,” RBI said in a statement.

“The above relaxation has been granted with a view to reducing the hardship of the depositors. The Reserve Bank is closely monitoring the position and shall continue to take further steps as are necessary to safeguard the interest of the depositors of the bank,” RBI said.

The RBI on Tuesday had barred the PMC Bank from carrying out almost all its routine banking activities for six months. It had allowed depositors to withdraw only Rs 1000 from any of their accounts. The crackdown caused panic among depositors.

The move came after the central bank has found certain irregularities in the bank, including under-reporting of NPAs and had put restriction on fresh lending.

The RBI also sacked the bank’s board of directors under sub-sections 1 and 2 of section 36 AAA read with section 56 of the Banking Regulation Act 1949. An administrator has been appointed to take charge.

The 35-year-old Bank is a multi-state cooperative bank with operations in Maharashtra, New Delhi, Karnataka, Goa, Gujarat, Andhra Pradesh and Madhya Pradesh. With a network of 137 branches, it ranks among the top 10 cooperative banks in the country.

Source- Economic Times.