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Today Date : Monday, June 24, 2024

Will the Reserve Bank increase cash credit limit?

Will the Reserve Bank increase cash credit limit?

The IIFL financial organization, which offers both business and jewellery loans, was told to cease offering jewellery loans right away in March of last year after receiving a complaint alleging that it had given loans without being transparent and in violation of RBI regulations. All non-banking financial institutions have received directives from the RBI as a result.
In a circular issued by the RBI, "According to Section 269 SS of the Income Tax Act, 1961, a person cannot take a loan of more than Rs. 20,000 in cash. Therefore, customers should not be given a loan amount of more than Rs.20,000 in cash. At the same time, those who need more than Rs.20,000 as jewellery loan can get the money through their bank account,” it said.
Also, non-banking financial institutions have been advised to strictly follow the instructions of the Income Tax Department in the mode of cash transfer. This new order of RBI has created an environment where not only financial institutions but also tens of thousands of customers are affected. Most of the common people and small farmers are in the habit of taking jewellery loans from non-banking financial institutions to meet their urgent cash needs.
Many people like small farmers, traders and workers are getting affected by the new order of RBI. It is difficult for them to spend more than Rs.20,000 by crediting their bank account.
It would be beneficial if the RBI increased the cash loan up from Rs.20,000 to Rs.50,000. It will be much more good if it is increased to Rs.1 lakh. If the Reserve Bank announces an increase in the cash loan limit, the middle class and middle class will benefit greatly; Let us hope that a good decision will be taken quickly!