PMC Bank withdrawal limit hiked from Rs 1,000 to 10,000; some relief for customers

PMC Bank withdrawal limit hiked from Rs 1,000 to 10,000; some relief for customers
By increasing the withdrawal limit from Rs 1,000 to Rs 10,000, over 60% of the bank’s depositors will be able to withdraw their entire account balance

In welcome news for thousands of affected customers, the Reserve Bank of India (RBI) on Thursday raised the withdrawal limit for Punjab and Maharashtra Cooperative (PMC) Bank account holders from Rs 1,000 to Rs 10,000.

“Accordingly, vide modified Directive dated September 26, 2019, it has been decided to allow the depositors to withdraw a sum not exceeding Rs 10,000 (including Rs 1,000 wherever already withdrawn) of the total balance held in every savings bank account or current account or any other deposit account by whatever name called, subject to conditions stipulated in the RBI directive dated September 23, 2019,” the apex bank stated in a notification.

The Rs 10,000 withdrawal limit includes the Rs 1,000, if withdrawn earlier. For example, a customer who has already withdrawn Rs 1,000 from his/her account can only remove an additional Rs 9,000.

It further said that “other terms and conditions of the said directive shall remain unchanged” adding that “with the above relaxation, more than 60 percent of the depositors of the bank will be able to withdraw their entire account balance.”

“The relaxation has been granted with a view to reducing the hardship of the depositors. The Reserve Bank is closely monitoring the position and shall continue to take further steps as are necessary to safeguard the interest of the depositors of the bank,” it stated.

The higher limit is subject to the fact the customer does not have any liability with the bank by way of loans of surety for a third-party loan, RBI said.

The apex bank has also asked PMC Bank to keep the amount required to pay the depositors separately in an escrow account or in earmarked securities which will be utilised by the bank only to pay to the depositors.

On Tuesday, the RBI imposed operational restrictions for 6 months on PMC Bank, which included capping the withdrawals at Rs 1,000 per account. The move came after it found certain irregularities in the bank, including under-reporting of NPAs.

Following which, the bank tried to allay fears of the depositors and customers, saying it has enough liquidity to meet all liabilities and every penny of the public is secure.

Asserting that all its loans are fully secured, the management admitted that one large account – HDIL- is the sole reason for the present crisis.

Meanwhile, several account holders of PMC Bank visited Sion police station earlier today and filed a joint police complaint against the bank’s chairman and its directors over the alleged misappropriation of their funds.

The complainants claimed that at least 14 people were involved in the alleged misappropriation of funds.

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