PMC Bank crisis: RBI raises withdrawal limit for account holders to Rs 50,000

Mumbai: Reserve Bank of India (RBI) on Tuesday enhanced withdrawal limit for depositors of Punjab and Maharashtra Cooperative (PMC) Bank Ltd to Rs 50,000. Earlier on October 14, the central bank had permitted the depositors of PMC Bank to withdraw up to Rs 40,000 of the total balance in their accounts.

Issuing a statement about enhancing the withdrawal limit for PMC Bank account holders, the RBi said, "after reviewing the bank’s liquidity position and its ability to pay its depositors has decided to further enhance the limit for withdrawal to Rs 50,000, inclusive of Rs 40,000 allowed earlier. With the above relaxation, more than 78% of the depositors of the bank will be able to withdraw their entire account balance."

"It has also been decided to allow the depositors to withdraw from the bank’s own ATMs within the prescribed limit of Rs 50,000. This is expected to ease the process of withdrawals," the RBI said.

The Reserve Bank has stated that it is closely monitoring the position and will continue to take further steps as are necessary to safeguard the interest of the depositors of the bank.

Notably, this is the fourth time that the regulator has increased the withdrawal limits since it clamped down on the PMC bank on September 23, and capped the withdrawal limit at Rs 1,000 per customer for six months.

Putting the co-operative bank under its scanner, the RBI had also barred the PMC Bank from renewing or granting any loans, or making investments without its prior approval.