RBI may hike weekly cash withdrawal limit to Rs 40,000 this week

The Reserve Bank of India (RBI) may hike the weekly cash withdrawal limit to Rs 35,000 - Rs 40,000, Zee Business said quoting sources. 

Currently the weekly cash withdrawal limit is at Rs 24,000. While the daily withdrawal limit from ATMs was previously raised from Rs 2,500 to Rs 4,000, the weekly limit was left unchanged.

Sources said that the RBI may issue a notification this week because of the increased availability of new notes with the central bank. They said the government was also in the favour of increasing the withdrawal limit. 

A limit on cash withdrawals from the bank and ATMs was imposed after the government demonetized the use of Rs 500 and Rs 1,000 notes on November 8 which effectively removed 86% (in value terms) from the system creating a massive shortage. The withdrawal limits were imposed to ensure fair distribution of cash while accounts were recalibrated with new Rs 500 and Rs 2000 notes and smaller denomination notes.