‘Jan Dhan’ Accounts: Cash Withdrawal Limited To Rs. 10000 Per Month

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The Reserve Bank of India in a move to curb the black money menace and in order to prevent the ‘Jan Dhan‘ accounts of the poor to be used to launder money, has issued directives on Wednesday, pegging the withdrawal limits at Rs. 10,000 per month. Earlier this month, the Finance Ministry had set an upper limit of Rs 50,000 for deposits into these accounts. Additionally, the RBI further specified that only KYC (Know Your Customer) compliant account holders will be allowed to withdraw Rs 10,000 a month from their account,; respective branch managers may allow further withdrawals beyond this upper limit of Rs 10,000 only after verifying the genuineness of these withdrawals and proper documentation.

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On the other hand, the limited or non-KYC-compliant account holders will be allowed to withdraw only Rs 5,000 per month from the amount deposited after November 9 through now-defunct bank notes but within the now specified ceiling of Rs 10,000. The RBI has stated that these restrictions are being imposed to protect the innocent farmers and rural account holders of the ‘Pradhan Mantri Jan Dhan Yojana’, or PMJDY, a pet project of PM Narendra Modi, from the illicit activities of money launderers and legal consequences under existing ‘Benami’ transaction laws.

The Economic Affairs Secretary, Shaktikanta Das, stated,”Some people are using Jan Dhan accounts to deposit black money. Up to Rs 50,000 can be deposited in Jan Dhan accounts.” The move comes in the wake of several reports that money launderers were paying hefty commissions to ensure that they could use the Jan Dhan accounts to legalise their unaccounted-for money by transferring them into these and later withdrawing them in newly-issued currency notes.

Statistics reveal that in the first two weeks of demonetisation which was declared on November 8, the total balance in minimal-maintenance accounts under the PMJDYincreased by 60% to Rs 72,834.72 crore. Prior to that this scheme, launched in August 2014, took 16 months (till December last year) before it could accumulate a net balance of Rs 27,283.05 crore. These figures point to theillicit usage of these accounts and the RBI’s steps are in light of these figures being scrutinised.

A contrary view has also emerged, with sources stating that since demonetisation was announced, the cash chaos has yet to die down all over the country, the cash-strapped commoner will get a relief if withdrawal limits of these widely-spread accounts are tightened, ensuring available liquidity and the availability of new bank notes to more and more people, even as the government and the RBI are struggling to contain the cash-chaos.

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