RBI REGION

New RBI guidelines on cash deposits of demonetised notes add to confusion

Individuals will only be able to deposit demonetised bank notes above ₹5,000 only once till the remainder of the deposit deadline i.e. December 30, 2016.


RBI Governor Urjit Patel (file photo)
Fresh guidelines issued by the Reserve Bank of India on Monday on limiting cash deposits of demonetised bank notes have added to the confusion. The central bank issued guidelines where it said that individuals will only be able to deposit demonetised bank notes above ₹5,000 only once till the remainder of the deposit deadline i.e. December 30, 2016.
On the surface, the guideline appears to be one that will hit the remaining black money hoarders in a single blow. However, the government hasn’t been able to plug laundering and cash leaks at banks. Therefore, the common person, who would’ve planned to deposit the money at a later stage, for various reasons like possibly to beat the early queues, would be hit unnecessarily.
Since the time demonetisation was announced, RBI has played a less than stellar role in managing the currency exchange and currency distribution process. Regular guidelines coming at regular intervals put the country in a state of confusion as to what will follow next and the damage control seems to be never-ending.
The guideline does not apply to deposits below ₹5,000, but multiple deposits, if account for an amount over ₹5,000, will also come under the scanner. The bank further said that tenderer will have to deposit the notes in front of two bank officials who will record the individual’s statement as to why he/she was unable to deposit the money till now and only after they are fully satisfied with the explanation, will they deposit the money.
The explanation and the deposit process will be kept on record for an audit trail. On the whole it seems that the bureaucrats in north block are pulling each string rather than the RBI which should ideally be leading the charge to cut through the uncertainty and confusion.