The easing will come into effect from February 1.
"On a review of the pace of remonetisation, it has been decided to partially restore the status quo ante," RBI said in a notification today.
"The limits on savings bank accounts will continue for the present and are under consideration for withdrawal in the near future ... Limits on cash withdrawals through ATMs is being withdrawn from February 1," it said.
RBI last week had said the new currency notes in circulation had reached around Rs 9.8 lakh crore.
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The central bank move also comes amidst RBI rejecting a a request by the Election Commission to lift withdrawal limits for the candidates in five poll-bound states and a day ahead of the Budget Session of Parliament.
The central bank said the limits on cash withdrawals from current accounts or cash credit accounts or overdraft accounts is withdrawn with immediate effect.
Following demonetisation, RBI had put withdrawal limit Rs 2,000 per day from ATMs and Rs 10,000 per week. Customers holding a current or overdraft or cash credit accounts, were allowed to withdraw up to Rs 50,000 in a week.
Towards November end, RBI increased the caps on savings bank withdrawals to Rs 24,000 a week.
Early January, it was further relaxed to Rs 4,500 per day from ATMs, but retained the weekly withdrawal limits. On January 16, RBI enhanced the ATM withdrawals further to Rs 10,000 daily, while keeping the weekly limits at Rs 24,000.
With today's notification, a customer can withdraw Rs 24,000 in a day through the ATMs, but he will exhaust the weekly limit of Rs 24,000. The customer will have to wait for another week to withdraw beyond that.
The notes that were scrapped on November 8 constituted 86 per cent or Rs 15.55 trillion of the currency in circulation.
The central bank also urged banks to encourage their constituents to sustain the movement towards digitisation of payments and switching over of payments from cash mode to non-cash mode.