The Greek government will keep banks shut at least through July 5, and withdrawals from ATMs, which were shut on Monday, will be limited to 60 euros a day when they reopen Tuesday. The stock exchange will also remain closed.
Meanwhile, anxious Greek pensioners swarmed closed bank branches Monday in the hope of getting their pensions.
Deputy Minister of State Terence Quick said special arrangements would be made for pensions, telling private Antenna television that pensions would be dispensed in full, since many pensioners don't have bank cards.
But dozens of pensioners who lined outside at least two offices of the National Bank of Greece on Monday after hearing they could withdraw pensions from some branches were turned away, a Reuters photographer said.
“I've worked all my life, only to wake up one morning to a disaster like this,” said one shop owner, who was there to collect his wife's pension.
After months of wrangling, Greece's exasperated European partners have put the blame for the crisis squarely on Tsipras' shoulders.
The creditors wanted Greece to further cut pensions and raise taxes in ways that Tsipras has long argued would deepen one of the worst economic crises of modern times, in a country where over a quarter of the workforce is already unemployed.
The newspaper Nafetemporiki ran the front-page headline “Dramatic hours”; Ta Nea read, “When will the banks open?”
Despite the financial shock, parts of daily life went on as normal, with shops, pharmacies and supermarkets in Athens opening and Greeks meeting to discuss their country's fate at cafes and restaurants. Tourists gathered as usual to watch the changing of the presidential guard outside parliament.
Despite the hardening of positions, officials around Europe and in the United States made a frantic round of calls and organized meetings to try to salvage the situation.
U.S. President Barack Obama called German Chancellor Angela Merkel, and senior U.S. officials, including Treasury Secretary Jack Lew, who spoke to Tsipras, urged Europe and the IMF to come up with a plan to hold the currency together and keep Greece in the eurozone. The German and French governments announced emergency political meetings.
Al Jazeera and wire services