08 April, 2020
2 Min Read
RBI relaxed the norms of State/UT to avail overdraft
On April 7, 2020 The Reserve Bank of India (RBI) has decided to increase the number of days that a State/UT can continue to overdraft to 21 working days from the current stipulation of 14 working days as they are facing cash flow mismatches due to coronavirus.
i.In addition, the number of days that a State/UT can overdraft in a quarter has also been increased to 50 working days from the current stipulation of 36 working days, while all other stipulations remain unchanged.
ii.The new arrangement is effective immediately and is valid until September 30, 2020.
iii.It has also increased the Ways and Means Advances (WMA) limit by 30% from the existing limit (Rs 1.20 lakh crore) for all States/UTs which was effective from April 1, 2020 & is valid till September 30, 2020.
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