Mumbai: PMC cash cap Rs 10,000, now

Mumbai: In a marginal relief to depositors in the trouble-ridden Punjab and Maharashtra Co-operative (PMC) bank, the RBI on Thursday increased the withdrawal cap from the earlier Rs 1,000 to Rs 10,000.

A senior RBI official told the FPJ that the new directive will enable the depositor (s) to withdraw the amount (Rs 10,000) in one or multiple transactions at their convenience.

"The relaxation has been granted with a view to reducing the hardship of the depositors," the official said.

On September 23, the RBI, through a directive, had capped cash withdrawals at Rs. 1,000 for a period of six months, stating that it was doing so in the interest of the depositors.

However, the cap had put the ordinary depositors to untold misery, in the backdrop of the approaching festive season.

The official said that the RBI appointed administrator had made a preliminary assessment of the depositors’ and the bank’s liquidity profile and submitted it to the RBI, which hastened a review of the earlier directive.

"It was found that 60 per cent of the depositors had balance in the range of Rs. 10,000. It was then decided to allow those depositors to withdraw the full amount," the official said.

For depositors having more than Rs. 10,000 balance in their account and those who are in desperate need to make large withdrawals to meet exigencies like marriages or medical/ study expenses, the RBI official said, "the 'hardship' cases will be heard by the administrator as and when they approach.

In similar cases in the past, the RBI has extended such relaxation to depositors in distress." Meanwhile, amid allegations that the fiscal duress of the bank was inflicted by undue exposure to certain construction firms in violation of banking norms, the official said,

"Only an inspection would establish whether it was one or more parties that had enjoyed illegal patronage of the bank."

"The RBI is closely monitoring the position and shall continue to take further steps, as are necessary to safeguard the interest of the depositors of the bank," a RBI release said.

Nevertheless, the present cap on withdrawals has spread panic amongst thousands of customers of the bank spread across seven states in the country.

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