The RBI on Monday announced that deposits of demonetised Rs 500 and Rs 1,000 notes in excess of Rs 5,000 will now be allowed only once till December 30- that too after strict scrutiny.
The new restrictions are meant to encourage deposits of the demonetised currency under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana, 2016.
The Finance Ministry said the decision will help end the unending queues in banks.
In its notification, the Reserve Bank of India told banks to give full credit to the scrapped notes above Rs 5,000 only in the case of accounts compliant with 'Know Your Customer' (KYC) norms.
If the accounts are not KYC compliant, then the credit for deposits of demonetised currencies will be restricted to Rs 50,000.
According to RBI, when a person deposits over Rs 5,000 in withdrawn currencies, then credit shall be given to that person's account only after questioning him or her, in the presence of two bank officials, as to why the notes were not deposited earlier.
The bankers will keep the explanatory statement on record for future audit trail.
The government demonetised Rs 500 and Rs 1,000 notes on November 8, saying the move was meant to fight corruption, black money and terror funding.
Deposits of Rs 500 and Rs 1,000 notes up to Rs 5,000 in value received across the counter will be allowed to be credited to bank accounts in the normal course until December 30.
But if the deposits are less than Rs 5,000 at a time but cumulatively the value exceeds Rs 5,000, then the bank officials have to follow the procedure of getting on record the explanation from the depositor why the deposit was not made earlier.
The above restrictions shall not apply to deposits under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana.
The equivalent value of demonetised notes tendered may be credited to an account maintained by the depositor at any bank in accordance with standard banking procedure and on production of valid proof of identity.
In case of deposits into third party accounts, banks can give credit provided there is specific authorisation given by the account holder to be presented to the bank and a valid identity proof of the depositor.
The Finance Ministry explained why it took this new step.
"It is expected that, by now, most people would have deposited such old notes. Keeping this in view and to reduce the queues in the banks, it has been decided that amounts exceeding Rs 5,000 in old notes can be deposited only once between now and December 30," the ministry said.
"We want people to deposit old notes at one time. After December 30, things will improve at a great speed," Minister of State for Finance Arjun Ram Meghwal told reporters here.
The demonetisation has triggered an unprecedented cash crunch in the country, with people mobbing banks and ATMs to withdraw cash in seemingly unending queues.