Withdrawal restrictions likely to go away by February-end

With the cash crunch situation easing, Reserve Bank may do away with the weekly withdrawal limits from banks as well as ATMs by the end of next month, bankers said. The RBI had recently raised the ATM withdrawal limit to Rs 10,000 a day but maintained the weekly cap at Rs 24,000 for saving account and Rs 1 lakh for current account holders. "I think the restrictions on withdrawal by RBI should be completely lifted by February-end or by first half of March as cash situation is easing gradually," Bank of Maharashtra executive director R K Gupta said. According to SBI's research report Ecowrap, "By the end of February, 78-88 per cent of the currency could be back in the system under the best case scenario in terms of an optimal currency distribution (more small denomination notes)," the report said. However, RBI Governor Urjit Patel could not set a time frame before the Standing Committee on Finance for return of normalcy in the banking system even as the central bank asserted that Rs 9.2 lakh crore or 60 per cent of demonetised currency has been replaced.