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ASSOCHAM makes plea to FM for relaxing cash withdrawals for industry

ANI  |  New Delhi [India] 

has urged the to consider lifting the withdrawal limit for the corporate firms from the banks, as there is no scope for any misuse since such withdrawals are properly recorded, audited and can be subject to scrutiny by any authority including the departments.

"The withdrawal limit of Rs 50,000/- per week from the current account is very less for industry. Therefore it needs to be enhanced, and the industry should not be subject to any limit because withdrawn by industry is duly recorded, audited and scrutinised by the authorities such as Department etc," said in a letter to the Minister Mr Arun Jaitley.

The letter also sought restructuring of the loans and repayments schedules for a large number of industries, particularly in the small scale sector, which has been hit by the demonetization of high value notes.

Expressing apprehensions that the companies which are dependent on the banks and institutions for would be hit, the chamber said, "in such a situation the borrowers particularly the private limited companies and MSME sector would default in loan repayments/interest payments. Under this state of affair, the industry would require rescheduling of payments of loans as well as additional financial support to meet the liquidity requirement without any penal action".

Further to ease the problems of the retail customers and small traders, the chamber suggested that the " may think of issuing cards (like metro card) so that even a person who does not have account can carry this card and can use it as Debit/Credit card for making payments".

It said speedy distribution of cash is necessary so that people have confidence that sufficient cash is available in the system and there is no need of holding extra cash in hand

The ASSOCHAM letter to the Minister said the industry has day to day expenses of small nature such as repair & maintenance, staff welfare, consumable items and loading and unloading. These are incurred in cash and are mainly paid to people in the unorganised sector who do not accept cheques. Till the economy largely converts into cashless economy industry will face problem in its day to day expenses.

The chamber also suggested that network of banks in rural areas should be spread so that every village has and ATM machines.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, December 02 2016. 12:31 IST