The Reserve Bank of India (RBI) announced its decision to remove Rs 2,000 denomination notes from circulation and instructed banks not to issue any more of them as of right now.
The central bank has also said that the ATMs and Cash Recylers would be adjusted appropriately.
In order to minimize the annoyance to the public, it said that banks may convert up to a total of 20,000 rupees (10 notes per account holder) in banknotes from one account holder at a time.
All banks must provide the option to swap Rs 2,000 banknotes via their branches to all members of the public.
While deposits of the notes are accepted as normal, the RBI has allowed banks till May 23 to prepare for the exchange of the Rs 2,000 notes.
Business Correspondents may also be permitted to convert up to 4,000 rupees worth of currency for an account holder each day. Banks may, at their discretion, increase the BCs' cash holding limitations for this reason.
Banks may explore deploying mobile vans, if required, to provide deposit/exchange facilities to residents of remote/unbanked regions, it stated.
The same restrictions will still apply when crediting the amount of Rs 2,000 notes to Jan Dhan Yojna Accounts or Basic Savings Bank Deposit (BSBD) Accounts.
Banks that own Currency Chests (CCs) must make sure that no withdrawals in the amount of Rs 2,000 are permitted from the CCs. All CC balances must be labeled as unsuitable and maintained available for transmission to the appropriate RBI offices.
All banknotes of this denomination received by banks must be promptly processed by Note Sorting Machines (NSMs) for accuracy and validity before being placed in currency chests under the Linkage Scheme or maintained available for delivery to the RBI's closest issue office.
The public will have access to the facility for depositing and/or exchanging Rs. 2,000 bills till September 30.
Additionally, the institutions must abide by any relevant regulations for reporting suspicious and cash transactions, respectively.