Demonitisation roll back: farmers allowed to use old Rs500 notes
21 November 2016
In a partial roll-back of the government's 8 November decision to demonetise high denomination currency notes to curb the menace of black money and fake currency in circulation, the finance ministry has relaxed the rules regarding discarded currency notes of Rs500 for the benefit of farmers in the middle of the Rabi sowing season.
As per the notice issued by the ministry of finance, farmers can now use the banned Rs500 notes for purchase seeds from government agencies for the current Rabi season.
The government's move follows a deadlock in the cash-dependent agriculture sector where farmers and daily wage earners across the country were hit hard as availability of cash dried up with the overnight demonetisation of Rs500 and Rs1,000 currency notes.
"To further support farmers for the current Rabi crop, the government has decided to allow farmers to purchase seeds with the old high denomination bank notes of Rs500 from the centres, units or outlets belonging to the central or state governments, PSUs, National or State Seeds Corporations, central or state agricultural universities and the ICAR, on production of proof of identity.
This is in addition to the decision taken earlier for making cash available with the farmers by permitting them to draw up to Rs25,000 per week from their KYC compliant accounts subject to the normal loan limits and conditions apart from the other facilities announced on 17 November.
The government is committed to ensure that the farmers are suitably facilitated during the Rabi season, the release stated.