Indian banks are fearful of running out of cash as lines queue up to withdraw money.
Bankers say they cannot cope with any sudden increase in demand, and warn against lifting cash withdrawal limits.
A decision by New Delhi on November 8 to scrap all large-denomination banknotes overnight removed 86 per cent of India’s currency from circulation. In an effort to prevent banks running out of cash, the finance ministry then imposed strict limits on the amount of new notes that could be withdrawn. Customers can currently withdraw just Rs2,500 from an ATM per day — equivalent to $37 — or Rs24,000 over the counter per week.
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“If the government lifts the limits on Friday and there is a sudden rush,