Prime Minister Narendra Modi’s announcement of the ambitious demonetisation drive on November 8, 2016 sent a massive wave of panic and shock that put the economy to a standstill for number of days, affecting the life of the billion citizens of the country. The move though lauded by many for its narrative of curbing down the flow of black money from the system also received severe criticism for its lack of planning and poor execution. As the conomy came to a standstill due to teh void created by the banning of all Rs 500 and Rs 1000 from the system, the RBI had to come up with aseies of rules and egulations to stop the country from erupting into chaos.
And while some of these rules eased the trouble for the common man, a few of them seemed unreasonable and drew a lot of flak, not only from politicians but also from the common man. Let’s have a chronological look at all the events that have transpired since November 8, 2016, follwoing the announcement of demonetisation.
November 8, 2016: PM Narendra Modi annonvced the abolishment of the high denomination currency notes of Rs 500 and Rs 1000 from midnight, in a fight against “black money”. All those in possession of the old Rs 500 and Rs 1000 were to deposit them in the banks by December 30, 2016. Limits were put on exchange of Rs 500 and Rs 1000 at banks’ withdrawal counters at Rs 4,000. Limit was established on cash withdrawals from banks at Rs 10,000 per day and Rs 20,000 per week till November 24. ATM withrawals were also limited at Rs 2,000 per day per card till November 18.
November 8, 2016: PM Narendra Modi announced the abolishment of the high denomination currency notes of Rs 500 and Rs 1000 from midnight, in a fight against “black money”. All those in possession of the old Rs 500 and Rs 1000 were to deposit them in the banks by December 30, 2016. Limits were put on exchange of Rs 500 and Rs 1000 at banks’ withdrawal counters at Rs 4,000. Limit was established on cash withdrawals from banks at Rs 10,000 per day and Rs 20,000 per week till November 24. ATM withdrawals were also limited at Rs 2,000 per day per card till November 18.
November 11: The RB I extends the deadline for the payments in old notes including the purchase of petrol for a limited time.
November 13: The Reserve Bank of India raises the weekly withdrawal limit from Rs 20,000 to Rs 24,000. It further removes the daily withdrawal limit of Rs 10,000, over the counter exchange of old Rs 500 and Rs 1000 notes from Rs 4,000 to Rs 4,500, withdrawal limit at ATMs from Rs 2,000 to RS 2,500 per day. It also waives off the ATM fees for all transactions for savings accounts.
November 14: Government asks banks to waive off transaction charges on debit and credit cards; raises cash withdrawal limit for current accounts to Rs 50,000 per week.
November 15: Government asks banks to use indelible ink to make sure people exchange cash only once.
November 17: Farmers are allowed to withdraw RS 25,000 per week against crop loans; payments of crop insurance premiums extended by 14 days. Slashes limit of over the counter exchange of old notes to Rs 2,000 from Rs 4.500.
November 18: RBI sets limit of cash withdrawal at card swiping machines at 2,000 rupees per day
November 21: RBI allows withdrawal of cash of Rs 250,000 for wedding expenses. Allows farmers to withdraw Rs 25,00 per week from loans and deposit accounts. Farmers are allowed to purchase seeds using old notes from state-run outlets.
November 23: Government promises Rs 210 billion in farm credits to farmers.
November 24: Government stops the exchange of old notes, allows only depositions. Allows certain payments in old notes including at tolls, hospitals for a limited time.
November 25: Old currency can be exchanged at RBI branches: RBI. The RBI sets an exchange cap for foreign currencies for tourists up to Rs 5,000 per week till December 15.
November 26: RBI orders banks to place 100 pct of deposits under cash reserve ratio
November 28: RBI allows withdrawals above Rs 24,000 weekly limit of deposits made in legal tenders. Govt. announces the tax amnesty scheme for unreported cash.
November 30: Reserve Bank allows banks to use all cash to meet the demands of a hiked cash reserve requirement ratio. RBI tightens monthly withdrawal rules from “Jan Dhan” accounts for poor
December 1: Government bans use of old notes at petrol pumps and airport ticket counters
December 7: Government withdraws November 30 order to place deposits under cash reserve ratio.
December 8: Government announces incentives for cashless transactions.
December 13: RBI directs banks to preserve CCTV footage between November 8 to December 30.
December 15: The Modi-government asks tax evaders to come out by March 2017 or face consequences.
December 16: RBI waives fees for some IPS from January 1, 2017, to March 31, 2017. Tourists are allowed to exchange Foreign exchange up to RS 5000 per week till December 31.
December 19: RBI tightens cash deposit rules, depositors must explain big amounts.
December 21: RBI rolls back the Rs 500 deposit limit, says that the depositors must not face scrutiny.
December 26: Farmers are allowed 60 days of extra time to repay crop loans.
December 30: RBI raises the per-day limit of ATM withdrawals to Sr 4,500 from Rs 2,500. Monthly limit on mobile wallets stays at Rs 20,000 per month.
December 31: NRIs and resident Indians who have been out of the country given a time period from November 9-December 30 to exchange old notes.
January 16, 2017: RBI ups the ATM withdrawal limit to Rs 10,000 per day per card from Rs 4,500.
As of the time of publishing this article, the RBI had set a withdrawal limit for ATMs to Rs 10,000 per day. While the last two months of demonetisation have been tough, the citizens of the country remain divided between the implications and the implementations of the drive.