RBI announced on Monday lifting of restrictions on withdrawals from Current accounts/Cash credit accounts/ Overdraft accounts with immediate effect. Limits on withdrawing cash from savings bank accounts would however continue and are under consideration for withdrawal in the near future. The RBI also said it will remove limits on cash withdrawals from ATMs from Wednesday, February 1.

The move came almost 3 months after Prime Minister Narendra Modi announced demonetization following which a nationwide cash crunch forced the RBI to clamp daily and weekly withdrawal limits. RBI on 16th January had increased the daily withdrawal limit from ATMs to Rs 10,000 while weekly withdrawal limit remained at Rs 24,000 for savings accounts and moved up to Rs 1,00,000 for current accounts.

With the lifting of the curb on daily withdrawals, savings accounts holders will now be able to withdraw Rs 24,000 at one go but they cannot withdraw any more money all that week thereafter.

RBI also said that banks may use their own discretion to place daily withdrawal limits, as was the case before demonetization.

The Election Commission had earlier requested RBI to relax the withdrawal limits for election candidates in the five poll-bound states. It has now decided to ask all candidates to open current accounts to meet election expenses.