MUMBAI: The Reserve Bank of India raised the daily withdrawal limit at automated teller machines to Rs 10,000 per card and doubled that for current accounts to Rs 1 lakh per week, signaling that the post-demonetisation cash crunch is easing as currency supplies have risen over the past few weeks.While the overall cap of Rs 24,000 per week for savings accounts stays in place, even that could soon be raised to as much as Rs 40,000, according to bankers with knowledge of the matter. They added that a new Rs 1,000 note is also in the works. The changes were notified by the central bank in a circular on Monday.The central bank is said to be in discussion with banks on raising savings account withdrawal limits as the supply of new Rs 500 notes has improved in the past few weeks. The current daily limit on card withdrawals at ATMs is Rs 4,500. The weekly cap on current account withdrawals is Rs 50,000.“The weekly limit could be raised to Rs 36,000 or Rs 40,000 a week per (savings) account,” said a banker who did not want to be named. Bankers said the relaxation is expected in phases as RBI moves toward restoring confidence among customers. Prime Minister Narendra Modi announced on November 8 that Rs 500 and Rs 1,000 notes would cease to be legal tender at midnight, invalidating about 86% of notes in circulation.While RBI has issued new Rs 2,000 and Rs 500 notes, plans for a new Rs 1,000 note had previously been denied. The central bank is said to be working on security features for the new Rs 1,000 note, likely to be the same size as either the Rs 500 or the Rs 2,000 note so that banks don’t have to tweak the ATM cassettes to dispense them, said the bankers cited above. The new notes are smaller than the ones they replaced, which meant the machines needed to be recalibrated to take them, exacerbating the cash squeeze.RBI did not respond to an email seeking comment. The central bank had initially imposed a weekly limit of Rs 20,000 for cash withdrawals by individuals, subsequently raised to Rs 24,000. Bankers said that with currency presses working around the clock, cash supplies have improved. While several ATMs in the national capital region seem to be constantly out of cash, bank branches are said to have enough currency to service customers at their counters.Almost Rs 14 lakh crore of the old Rs 500 and Rs 1,000 notes has come back to banks in the form of deposits, a banker said. That’s out of an estimated Rs 15.4 lakh crore of cancelled currency. As supplies have increased, panic has eased and people aren’t holding onto cash, which has further eased the situation.“Our assessment is that of total notes demonetised, say 30% was sitting idle,” said a banker. “Of the remaining 70%, we think 40% has already come into the system. So we assume the cash situation will get better by next month, provided people don’t hoard cash.” RBI has faced criticism over poor planning that led to cash shortages after demonetisation