Number of the week: Rs 10,000

Business Standard
3rd October

Rs 10,000: Enhanced withdrawal limit allowed by RBI to customers of PMC Bank.

  • When the Reserve Bank of India had initially barred Punjab and Maharshtra Co-operative (PMC) Bank from carrying out routine banking activities, it had imposed a limit of Rs 1,000 on withdrawals from the bank.
  • This paltry sum was all that depositors could withdraw for six months. Many, including senior citizens, who depended on regular withdrawals to meet their household and business-related needs, were left in the lurch.
  • Later, the RBI hiked the amount depositors could withdraw for six months to Rs 10,000. It said this would allow 60 per cent of depositors to withdraw the entire sum they had parked with the bank.
  • While this step will definitely provide relief to the majority of customers, for many others, even this enhanced sum will not suffice.
  • This incident has once again highlighted the need to avoid weaker banks, like some co-operative banks.
  • Maintain your deposits with two or three banks. Even if you opt for a co-operative bank for the higher interest rate it pays on fixed deposits, put only a small portion of your corpus there.

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A few links for further reading

Invest and emigrate

The great Indian dream of settling abroad is achievable if one has a few crores to invest. Rich nations offer a variety of investment options in a quid pro quo arrangement: immigrants get a better quality of life and revenue from them helps these countries’ finances. Wealthy Indians, troubled by polluted cities and the red tape holding up entrepreneurship, may want a quick ticket out of the country. Sanjay Kumar Singh lists a range of options: from a Canadian province’s investor programme to America’s US EB-5 plan.

Small savings schemes

Investors in small savings schemes breathed a sigh of relief when the government announced on October 1 that interest rates on these instruments would not be revised for the fourth quarter of the calendar year. With the economy witnessing a slowdown, and the stock markets also turning volatile, many investors are looking for alternative avenues to park their savings. Small savings schemes, with their sovereign guarantee, have emerged as a viable alternative.

Hard path to growth

The signals for the economy are not positive: overall demand is yet to pick up; the share of total exports in India’s GDP is declining, and industrial output pattern remains worrying.

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