India's central bank said on Monday it would allow depositors of troubled New India Co-operative Bank to withdraw up to 25,000 rupees (about $290) from their accounts.

With this relaxation, more than 50% of the total depositors will be able to withdraw their entire balances, says RBI

In a sigh of relief for irked customers of New India Co-operative Bank, the RBI on Monday permitted withdrawals of up to Rs 25,000 per depositor from the accounts at the troubled co-operative lender,

India's central bank on Monday revised certain norms for urban co-operative banks (UCBs), with a view of providing them with greater operational flexibility, while meeting regulatory objectives.

A former general manager of New India Co-operative Bank, Hitesh Pravinchand Mehta, was allegedly found involved in siphoning ₹122 crore off the lender. The authorities have arrested three people involved in the case as of February 21.

The RBI had placed All-Inclusive Directions (AID) on the bank on February 13, preventing any withdrawals due to concerns over its liquidity and financial stability.

In a move which can alleviate the concerns of many account holders, the Reserve Bank of India (RBI) has allowed depositors of New India Co-operative Bank Limited, Mumbai, to withdraw up to Rs 25,000 from their accounts.

In some relief for depositors of New India Co-Operative Bank, the Reserve Bank of India (RBI) on Monday, February 24, allowed them money withdrawal of upto Rs 25,000. The withdrawal limit relaxation is effective from February 27.