Demonetizaton: Govt places limits on last minute deposits

The Reserve Bank of India said that any person who continues to hold old notes of 500 and 1000 rupees in bulk will get only one more chance to deposit them into bank accounts and will also have to provide an explanation for the delayed deposit.

“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,” the RBI said.

The move indicates that the government is planning for the long haul in trying to ferret out illegitimate funds from those that have been deposited so far.

The banks have been directed to make an entry into the central database so that the person will not be able to deposit money in any other bank.

“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,” it added.

RBI also added that the full value of tenders of old notes in excess of ₹5000 shall be credited to accounts that are fully compliant with know-your-customer norms and if the accounts are not KYC compliant credits may be restricted up to ₹50,000.

As before, agents and others will be authorized to deposit money into other people’s accounts, provided they have documentary proof that they are acting on the latter’s behalf.

“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,” RBI added.