RBI relaxes cash withdrawal limit for wage payment in tea sector Back to News & Events List


After the smooth payment of first-fortnight salaries in cash to 12 lakh tea workers in Assam and a majority of the five lakh workers in Bengal through district collectors, the RBI has changed the methodology for the next tranche.

Under the new norm, the BI has relaxed its previous restriction on cash withdrawal for the tea gardens (meant for all companies). They can now withdraw cash and disburse wages as usual, except for one rider.

To restrict overdrawing of the cash requirement for wage payment, it is restricted to a pre-set formula of 2.5 labourers per hectare, each drawing an estimated fortnightly salary of ₹1,400 a fortnight.

Describing this as an “interim measure”, the RBI has advised bankers to open accounts for all plantation workers and set up ATMs and micro-ATMs on a war-footing to help tea estates make bank transfers for the next fortnightly payment, due in the middle of December.

In a separate order, the Assam government has asked tea producers and banks to ensure financial inclusion of plantation workers by December 5.

The tea industry, in the past, cited the lack of a banking network for its cash dealings. Tea labourers are paid wages fortnightly. The first fortnightly payment was due in the week after demonetization. The next payment is due this week.

“We have started dispensing cash to planters in West Bengal since November 23. Also, deployed are five mobile ATMs in the region,” Partha Pratim Sengupta, Chief General Manager of State Bank of India (SBI), Kolkata, told BusinessLine.

According to Sengupta, the formula for wage payment has drawn upon wage agreements and was discussed and approved at the State-level bankers meet last week.

Tea industry sources say the same model has been adopted for Assam, which was the first to activate State machinery to help the tea industry pay wages following demonetization.

Sources say tea estates in Assam will be comfortable with the new norms too. But the same may not be true for Bengal’s gardens, overstaffed due to union pressures.

Original Source: thehindubusinessline.com


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