To promote digital payments and the formal banking system and to block tax evasion and financial crimes, the government has limited the amount of cash to be transgressed in every purchase to Rs 500,000. From mid January, any payment above this amount must be made through banks using tools like cheques, mobile banking, internet banking, RTGS, IPS, or ConnectIPS. The rule does not apply to bank deposits, loan repayments, or transactions between financial institutions. People can still keep large cash amounts at home or use cash for events like weddings if they disclose the source and purpose. Officials say the new limit will help reduce illegal financial activities and lower government costs related to handling cash.
Govt Makes Purchases Above Rs 500,000 Mandatory Through Banking System
