IMPACT | 10 November 2016
Long queues were seen outside banks to deposit and exchange banned Rs. 500 and Rs. 1,000 notes. Long queues formed at banks across the country today as millions rushed to deposit and swap Rs. 500 and Rs. 1,000 notes, banned in a surprise announcement by Prime Minister Narendra Modi to check black or untaxed money.
Here are the top 10 developments:
There were chaotic scenes at banks and people waited for hours to exchange their old notes. Thousands of security personnel have been posted near banks.
Deposits above Rs. 2.5 lakh will be taxed and could draw a 200 per cent penalty if found disproportionately higher than the account owner’s income, the government has said.
Asserting that there would be no harassment for smaller deposits, Finance Minister Arun Jaitley said: “Those individuals who have large undisclosed amounts will have to face the consequences.” People buying jewellery with cash will also be tracked.
Banks will stay open this weekend and many banks have announced longer working hours. “There is no need to rush in the initial days,” advised Mr Jaitley.
PM Modi’s bombshell on Tuesday prompted a late night rush on cash machines as customers withdrew smaller notes from ATMs before they closed at midnight in preparation for the turnaround, but millions were left stranded without cash.
New banknotes of 500 and 2,000 rupee denominations will be available in ATMs from tomorrow.
Withdrawals from banks are limited to Rs. 10,000 a day and in ATMs, there will be restriction of Rs. 2,000 per day per card in the first few days, which will later be raised to Rs. 4,000 later.
Rs. 1000 notes will return in a few months with new security features, said Economic Affairs Secretary Shaktikanta Das. All cash denominations will have new security features but old notes will remain legal.
Old notes will be accepted till midnight on Friday for water and electricity bills, government penalties, and at state-run petrol pumps, government hospitals, metros and at tolls. Highways are toll free for now.
People can deposit the old notes of Rs. 500 and Rs. 1,000 in banks or post office accounts till December.