State Bank of India raises cash withdrawal limit for customers

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State Bank of India has taken an important decision regarding cash withdrawal to help customers during the pandemic.

The country’s largest bank has temporarily increased the ceiling for cash withdrawal by customers at non-home branches.

The bank has also enabled non-home cash withdrawal by third parties at all its branches.

Increased limit

SBI has doubled the amount of cash withdrawal through cheque in non-home branch for self to Rs 1 lakh per day. Earlier, the limit was Rs 50,000.

Cash withdrawal for self through a withdrawal form along with a savings bank passbook has been raised five times to Rs 25,000 per day from earlier Rs 5,000 per day.

This is applicable for transactions in both home branch and non-home branches.

Third-party cash withdrawals, which were not allowed earlier, have now been fixed at Rs 50,000 per month only via cheque.

Until September-end

‘Home’ branch refers to the branch where the customer’s account is maintained while all other branches are called ‘non-home’ branches.

The revision in ceilings for non-home transactions will stay in effect till September-end 2021, as per SBI order.

The need for cash transactions has increased during the pandemic with more and more people conserving cash.

More cash

On an average, Indians are storing cash more than what they in the past 10 years. Thanks to lockdowns that can prevent access to cash and apprehension of a sudden need for medical emergency, the circulation of cash in the economy has gone up to a level that is highest in the past decade.

Though one of the stated goals on the Centre is to build a cashless society, the circulation of cash kept rising during the pandemic-scarred 2020-21, RBI data shows.

Cash, as much as 14.6% of the GDP was in circulation in the economy in 2020-21, which was a significant jump from the 12.03% in the year before.

During the past decade cash in circulation as a share of GDP stood at 12.22% in 2011-12, 11.98% in 2012-13, 11.58% in 2013-14, 11.62% in 2014-15 and 12.08% in 2015-16 before diving to 8.26% in 2016-17 following the demonetisation on November 8, 2016.

However, it gradually climbed back to 10.7% in 2017-18, 11.31% in 2018-19 and 12.03% in 2019-20.

Covid-19 impact

State Bank of India has a customer base around 45 crore, a number that is more than 1.3 times the entire population of the US.

Obviously at any given point of time, a large number of customers are in dire need of crucial services such as issuance and blocking of ATM/debit cards, regeneration of PIN, checking balance in accounts and a host of other services apart from cash withdrawals.

The bank is constantly announcing on social media that customers can utilise many of its services from the comfort of their homes.