Rs500, Rs1,000 notes valid for 10 more days for select transactions
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New Delhi: The government late on Sunday night announced further measures to ensure easy availability of cash to people, especially in the rural areas, after Prime Minister Narendra Modi chaired a late-night meeting of senior government officials.
The government has extended the usage of existing Rs.500 and Rs.1,000 notes for select transactions till 24 November from the earlier deadline of 14 November.
This means that people can now use these notes at government hospitals, government-run cooperative shops, air-ticket counters, milk booths, petrol stations, burial grounds, international airports, to buy tickets at railway stations and for metro trains, to pay for medicines in government and private medical shops, to get cooking gas cylinders, and to pay court fees till 24 November. The usage of Rs.500 and Rs.1,000 notes has also been allowed for foreign tourists.
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Further, a task force will be set up under the Reserve Bank of India (RBI) deputy governor comprising officials of banks, RBI and the finance ministry, aimed at hastening the process of recalibration of ATMs, Shaktikanta Das, secretary, department of economic affairs in the finance ministry, told ANI.
The ATMs have to be prepared to dispense the new Rs.500 and Rs.2,000 notes along with Rs.100 notes. But this whole process is expected to take around 2-3 weeks because of which many ATMs across the country are still not functioning.
To ensure working capital needs of small businesses are met, the government has also permitted these entities to withdraw Rs.50,000 at a time from their current accounts that have been operational for at least three months.
For ensuring cash availability in rural areas, the cash holding limits of business correspondents tasked with reaching far off areas will be increased to at least Rs.50,000. They will also be allowed to withdraw cash multiple times in a day. A large number of micro ATMs will also be pressed into service to enable withdrawals.
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All government departments have been asked to maximize electronic transactions. Banks and National Payments Corporation of India have also been asked to waive off all transaction fees for electronic transfers.
Since announcing partial demonetization by cancelling the legal tender of the existing Rs.500 and Rs.1,000 notes, the government, RBI and the banks have been struggling to meet the cash requirements of the general public with widespread reports of long queues at banks and ATMs. The government has announced a number of measures over the last few days to ease the fund crunch, but it is expected to continue for the next few days, at least till all the ATMs begin functioning.