Govt asks banks to deposit junked notes with RBI by July 20
The government has given the last chance to district cooperative banks, commercial banks and post offices to deposit the banned Rs 500 and Rs 1,000 notes with the Reserve Bank by July 20, provided they were collected within the specified time period.
After the November 8 shock demonetisation announcement, the government had allowed commercial banks and post offices to accept the junked currency from the public until December 30. District central cooperative banks were allowed to accept them only until November 14.
The finance ministry, through a notification on Wednesday, allowed banks and post offices to exchange any old junked notes with RBI in the next one month, provided they were collected by December 30, 2016. The same window would also be available to cooperative banks if they had collected the banned notes by November 14.
The earlier window was open until December 31, a day after the 50-day period of demonetisation of high-value currency. Banks and post offices will, however, have to give reasons for not depositing the withdrawn notes with the specified time period "subject to the satisfaction of the RBI".
After demonetisation, the government gave holders of the junked currency a 50-day window to deposit it in their bank or post office accounts by December 30. But cooperative banks were on November 14 barred from accepting the junked notes as deposits or exchange them with the new currency. This left cooperative banks with crores of invalid currency notes. According to a recent report, district central cooperative banks in Maharashtra alone are stuck with Rs 2,770 crore worth old notes they collected during the early days of demonetisation but were unable to deposit them with RBI.