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The Reserve Bank of India on Wednesday exempted Know Your customer (KYC) compliant accounts from the new rules on deposits of above Rs 5000 .
No questions will be asked for deposits of old notes of Rs 500 and Rs 1,000 above Rs 5,000 for KYC accounts.
RBI had earlier imposed restrictions on the quantum of old notes that can be deposited in bank accounts.Old notes up to the Rs 5,000 limit received across the counter would be allowed to be credited into bank accounts in the normal course until December 30, the RBI had clarified. RBI had also said that the depositor has to give an explanation as to why the old notes were not deposited earlier. The amount will be credited in the bank account only after receiving a satisfactory explanation.
No questions will be asked for deposits of old notes of Rs 500 and Rs 1,000 above Rs 5,000 for KYC accounts.
In a message sent to all banks, the RBI said it had reviewed its instructions and decided that the rule will not apply to KYC-compliant accounts.
RBI had earlier imposed restrictions on the quantum of old notes that can be deposited in bank accounts.Old notes up to the Rs 5,000 limit received across the counter would be allowed to be credited into bank accounts in the normal course until December 30, the RBI had clarified. RBI had also said that the depositor has to give an explanation as to why the old notes were not deposited earlier. The amount will be credited in the bank account only after receiving a satisfactory explanation.
Analysts had said the move would add to the woes of those still waiting to deposit old notes. However, officials said people with money that was accounted for had no cause to worry.
Here is the full text of the RBI notification
Here is the full text of the RBI notification
RBI's latest notification says, "On a review of the above, we advise that the provisions of the above circular at sub para (i) and (ii) will not apply to fully KYC compliant accounts."
Sub para (i) and (ii) said that deposits exceeding Rs 5,000 in old notes will be permitted only with suitable explanation being provided to bankers.
And this is the earlier notification:
Please refer to Circular DCM (Plg) No.1226/10.27.00/2016-17 dated November 08, 2016 on the captioned subject. On a review of the provisions ii, iii and iv at C of Para 3 dealing with credit of the value of SBNs into bank accounts it has been decided to place certain restrictions on deposits of SBNs into bank accounts while encouraging the deposits of the same under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana, 2016 as indicated below:
Tenders of SBNs in excess of ₹ 5000 into a bank account will be received for credit only once during the remaining period till December 30, 2016. The credit in such cases shall be afforded only after questioning tenderer, on record, in the presence of at least two officials of the bank, as to why this could not be deposited earlier and receiving a satisfactory explanation. The explanation should be kept on record to facilitate an audit trail at a later stage. An appropriate flag also should be raised in CBS to that effect so that no more tenders are allowed.
Tenders of SBNs up to ₹ 5000 in value received across the counter will allowed to be credited to bank accounts in the normal course until December 30, 2016. Even when tenders smaller than ₹ 5000 are made in an account and such tenders taken together on cumulative basis exceed ₹ 5000 they may be subject to the procedure to be followed in case of tenders above ₹ 5000, with no more tenders being allowed thereafter until December 30, 2016.
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It may also be ensured that full value of tenders of SBNs in excess of ₹ 5000 shall be credited to only KYC compliant accounts and if the accounts are not KYC compliant credits may be restricted up to ₹ 50,000 subject to the conditions governing the conduct of such accounts.
The above restrictions shall not apply to tenders of SBNs for the purpose of deposits under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana, 2016.
The equivalent value of specified bank notes tendered may be credited to an account maintained by the tenderer at any bank in accordance with standard banking procedure and on production of valid proof of Identity.
The equivalent value of specified bank notes tendered may be credited to a third party account, provided specific authorisation therefor accorded by the third party is presented to the bank, following standard banking procedure and on production of valid proof of identity of the person actually tendering, as indicated in Annex-5 of our circular cited above.
2. Please acknowledge receipt.
Yours faithfully
(P Vijaya Kumar)
Chief General Manager
