While the move is aimed at curbing the flow of black money in the economic system, the announcement sent people into a tizzy on Tuesday evening. There was little clarity on where people could use their existing Rs 500 and Rs 1,000 notes.
Business Standard brings a quick guide on things you need to know:
Depositing the existing Rs 500, Rs 1000 notes:
From November 10 to December 30, users can deposit their old notes at the bank branch or post office, without any limit. The withdrawals from banks have been capped at Rs 10,000 per day, including those through cheques and ATMs, and up to Rs 20,000 a week. This limit will be increased in the coming days. For now, you can also exchange Rs 500 and Rs 1,000 notes for lower denomination at banks, head post offices and sub-post offices. The exchange limit has been fixed at Rs 4,000, and you can exchange these till November 24. One must , however, produce a legitimate government identity card like PAN, Aadhaar or election card.
Restrictions on ATM withdrawals:
ATMs will not function on November 9 and in some places on November 10, too. Banks will also be closed on November 9. You can withdraw money from November 11, and ATMs will discontinue dispensing Rs 500 and Rs 1,000 notes. Users must know that these withdrawals are being constrained to Rs 2,000 per card per day, and will later be increased to Rs 4,000 per card per day.
Places to use Rs 500, 1000 notes now:
If you have some currency notes of Rs 500 and Rs 1,000, there is no need to worry. You still have places where you can actually use these notes. For the first 72 hours, the following government-authorised places and institutions will continue to accept Rs 500 and Rs 1,000 notes for transactions:
The railway, air and government bus ticket booking counters will accept the old notes. Old notes will also be accepted till November 11 at petrol, diesel and gas stations authorised by public sector oil companies, consumer co-operative stores authorised by a state or the central government, milk booths authorised by states, and crematoriums.
Circulation of new notes:
The Reserve Bank of India will issue new Rs 500 and Rs 2,000 notes starting November 10. The new Rs 500 note will feature the Red Fort and the new Rs 2,000 note will have Mangalyaan printed on it, Economic Affairs Secretary Shaktikanta Das said at a media briefing late on Tuesday night.