New Delhi: The Reserve Bank of India’s 60th Notification, on day number 43 of Demonetisation, has partially rolled back an earlier notification that caused anger because it sought to restrict deposits of over 5000 rupees, in the process creating more confusion.
The earlier notification, issued on December 19, allowed the deposit of over 5000 rupees in bank accounts by citizens only once, that too after a “satisfactory explanation” could be provided to three bank officials.
Wednesday’s rollback makes an exception for fully KYC compliant customers. But it means that customers without fully compliant KYC norms will still have to give a “satisfactory explanation”.
KYC stands for ‘Know Your Customer’, a process through which banks obtain information about the identity of customers with accounts so that they cannot be misused. A proof of identity and a proof of address - Aadhar, license, Voters ID card, Passport or nrega card – have to be supplied for account verification.
Wednesday’s notification means that customers with fully compliant KYC accounts will be exempt from the order that states that deposits of over Rs 5000 could only be made once till December 30 and that people making such deposits will have to provide a “satisfactory explanation” to three bank officials as to why they didn’t deposit these amounts earlier.
This rule caused widespread anger and confusion all round, with people questioning why they had to provide an explanation for depositing their own money in excess of Rs. 5000. People cited legitimate reasons for waiting till the last week of December to deposit money. They also cited Prime Minister Narendra Modi’s promise in his November 8 address that people could deposit bank notes till December 30.
The decision follows widespread criticism of the guidelines, with people saying the Prime Minister as well as the finance minister have asked people not to throng the banks as they have time till December 30 to deposit invalid notes in their accounts.
Yogendra Yadav told CNN News18 that an “unfair and stupid” order had been rescinded. “It erodes the credibility of the RBI further,” he told the channel in a phone interview.
Another decision by the government taken on Wednesday has added to the all round confusion enveloping digital payments.
The Government passed The Payment of Wages (Amendment) Bill, 2016 to remove a provision that made employers seek written permission from employees before paying salaries by cheque or crediting them directly to bank accounts.
But at the same time government sources stressed that cash payment of wages have not stopped even though the government ordinance approves payment of wages electronically.
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