PMC Bank: RBI increases withdrawal limit

Panaji: Giving some more relief to depositors of Punjab and Maharashtra Cooperative (PMC) Bank, the Reserve Bank of India (RBI), on Tuesday, increased the withdrawal limit to Rs 50,000 from Rs 40,000 per account holder.

The enhanced limit for withdrawal is inclusive of all previous withdrawals allowed earlier.

To ease the process of withdrawal, the RBI has allowed depositors to withdraw from the bank’s own ATMs.

“With the relaxation, more that 78 per cent of depositors will be able to withdraw their entire account balance,” said the RBI.

In its notice of enhanced withdrawal, the apex bank said that it is closely monitoring the situation and “shall take further steps as are necessary to safeguard the interests of the depositors.”     

Since September 24, the PMC Bank is under RBI directions wherein the bank has been stopped from doing business and depositors are not allowed to withdraw sums beyond the permitted limit.

Lakhs of depositors with money in savings accounts are affected by the RBI directions.

To alleviate the distress to depositors, the RBI steadily enhanced the withdrawal limit from Rs 1,000 in September 24, 2019 to Rs 10,000, further to Rs 40,000 and now Rs 50,000.

The RBI directions are under Section 35A of the Banking Regulation Act, 1949 and imposed on account of major financial irregularities, failure of internal control and systems of the bank and under-reporting of exposures by the bank.  The bank is also placed under administrator control.