Foreign citizens can exchange foreign currency up to Rs. 5000 per week in India
New Delhi: The Central Government has been reviewing the issues related to the cancellation of legal tender character of old Rs. 500 and Rs. 1000 notes. The Government has also been receiving various suggestions in this regard. After due consideration of all relevant aspects, the following decisions relating to certain operational aspects of the Scheme have now been taken:
(i) It has been observed that over the counter exchange of the old currency notes of Rs. 500 and Rs. 1000 denomination has shown a declining trend. It has further been felt that people may be encouraged and facilitated to deposit their old Rs. 500 and Rs. 1000 notes in their bank accounts. This will encourage people who are still unbanked, to open new bank accounts. Consequently, there will be no over the counter exchange of old Rs. 500 and Rs. 1000 notes after midnight of 24.11.2016.
(ii) Government had also permitted various exemptions for certain transactions and activities wherein payment could be made through old Rs. 500 and Rs. 1000 notes. It has been decided that all these exemptions, with the additions and modifications as detailed below, may be continued for a further period from the midnight of 24.11.2016 up to and inclusive of 15.12.2016 :-
(a) Payments for the transactions under all the exempted categories will now be accepted only through old Rs. 500 notes;
(b) Payment of School fees up to Rs. 2000 per student in Central Government, State Government, Municipality and local body schools;
(c) Payment of fees in Central or State Government colleges;
(d) Payments towards pre paid mobile top-up to a limit of Rs. 500 per top-up;
(e) Purchase from Consumer Cooperative Stores will be limited to Rs. 5000 at a time;
(f) Payment of current and arrear dues to utilities will be limited to only water and electricity. This facility will continue to be available only for individuals and households;
(g) Considering that the Ministry of Road Transport and Highways have continued the toll free arrangement at the toll plazas up to 2.12.2016, it has been decided that toll payment at these toll plazas may be made through old Rs. 500 notes from 3.12.2016 to 15.12.2016.
(h) Foreign citizens will be permitted to exchange foreign currency up to Rs. 5000 per week. Necessary entry to this effect will be made in their passports. (Necessary instructions in this regard will be issued by the RBI.)
The Finance Minister Shri Arun Jaitley emphasised that physical currency must shrink while the economy should expand, shifting more and more focus to digital currency. He said that one of the major objectives of withdrawal of legal tender status on Rs. 500 and Rs. 1000 notes was to move the Indian economy further towards digital transactions. Shri Jaitley was speaking while reviewing the latest status after withdrawl of legal tender nature of old Rs.500 and Rs.1,000 notes in a Video Conferencing with CMDs/CEOs of Public and Private Sector Banks today. Series of decisions were taken during the meeting.
In this direction, most Banks have already begun a promotional exercise by waiving-up to end December MDR charges on debit cards. Banks will now be focussing on significantly stepping-up transactions in mission mode through alternate banking channels such as NEFT, mobile wallets, pre-paid cards, QR codes, pay-roll cards, debit and credit cards and Unified Payments Interface (UPI). Apart from urban areas, Banks will increase and sustain their focus on semi-urban and rural areas. This outreach would be backed-up by an advertising campaign from Indian Bankers Association (IBA) including demonstration videos on how to use cards and other modes for cash less transactions.
As the rush at bank branches is now reducing, banks will restart normal lending activities and in particular Mudra loans. These would help meet restocking requirements of enterprises by way of working capital delivered through Mudra cards.
Sowing season for Rabi and crops like potato is currently underway in many States. Necessary resources for the purpose have been provided by NABARD and daily releases to DCCBs (District Co-operative Banks) are a focus area of monitoring.
With these and other steps already underway, there is a clear path towards more digital transactions by all citizens. This will serve the larger objective of making banking activity easier and achieving the goal of financial inclusion that the Government is committed to.
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