No over-the-counter exchange of demonetised Rs 500 and Rs 1,000 notes will be allowed after midnight, the Centre announced on Thursday. The government said the decision was made to “encourage people, who are unbanked, to open new bank accounts” and also because of the “declining trend” in the over-the-counter exchange of the scrapped currency.

However, while announcing the demonetisation decision on November 8, Prime Minister Narendra Modi had set the exchange limit to Rs 4,000 till November 24 and said that the it would be increased from November 25 to December 30.

Moreover, payments for transactions in exempted categories will now be accepted only through the old Rs 500 notes. These include transactions at government hospitals, fuel bunks and toll booths on national highways, among other exemptions including the following:

  • Payment of school fees of up to Rs 2,000 in central and state government schools as well as in institutes run by municipalities and local bodies
  • Payment of fees in central and state government-run colleges
  • Payments towards prepaid mobile top-ups, each with a Rs-500 limit
  • Purchases from consumer cooperative stores, which will now be limited to Rs 5,000 at a time
  • Payment of current and arrear dues for utilities, which will be limited to only water and electricity (the facility will only be available to individuals and households)
  • Citizens of other countries will be permitted to exchange foreign currency up to Rs 5,000 per week, with each exchange being noted in their passports.