RBI to withdraw Rs 2,000 currency notes; to continue as legal tender

The Reserve Bank of India (RBI) on Friday mentioned that it’ll withdraw the Rs 2,000 denomination banknote from circulation although it is going to continue as legal tender till the window to deposit or alternate in banks, that’s, up to Sept 30, 2023.

In a press release, the RBI mentioned: “The 2,000 denomination banknote was launched in November 2016 primarily to meet the currency necessities of the economic system in an expeditious method after the withdrawal of legal tender standing of all 500 and 1,000 banknotes in circulation at the moment.

It additionally mentioned that each one banks shall present deposit and/or alternate facility for 2,000 banknotes till September 30, 2023.

“The goal of introducing 2,000 banknotes was met as soon as banknotes in different denominations turned accessible in enough portions. Therefore, printing of 2,000 banknotes was stopped in 2018-19,” the RBI mentioned.

The RBI mentioned that about 89 per cent of the 2,000 denomination banknotes have been issued prior to March 2017 and are on the finish of their estimated life-span of 4-5 years.

“The whole worth of those banknotes in circulation has declined from Rs 6.73 lakh crore at its peak as on March 31, 2018 (37.3 per cent of notes in circulation) to Rs 3.62 lakh crore constituting solely 10.8 per cent of Notes in Circulation on March 31, 2023,” it mentioned.

The RBI additionally identified that this denomination just isn’t generally used for transactions and additional, the inventory of banknotes in different denominations continues to be enough to meet the currency requirement of the general public.

“In view of the above, and in pursuance of the ‘Clean Note Policy’ of the Reserve Bank of India, it has been determined to withdraw the 2,000 denomination banknotes from circulation,” the RBI mentioned, including: “The banknotes in 2,000 denomination will continue to be legal tender.”

(With inputs from IANS)