The RBI, in a statement on Friday, said that all Rs 2,000 currency notes must be exchanged before September 30, 2023
The ₹2000 denomination banknote was introduced in November 2016. It was a part of the demonetization initiative undertaken by the Reserve Bank of India (RBI) and the Indian government. The decision was aimed at curbing black money, counterfeit currency, and promoting a digital economy. The ₹2000 note was introduced along with the new ₹500 note, while the older ₹1000 and ₹500 notes were demonetized.
NEW DELHI: The Reserve Bank of India (RBI) on Friday announced to withdraw the Rs 2,000 denomination banknotes from circulation. However, the Rs 2,000 notes will continue to be legal tender.
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The ₹2000 denomination banknote was introduced in November 2016 under Section 24(1) of RBI Act, 1934, primarily to meet the currency requirement of the economy in an expeditious manner after the withdrawal of legal tender status of all ₹500 and ₹1000 banknotes in circulation at that time. The objective of introducing ₹2000 banknotes was met once banknotes in other denominations became available in adequate quantities. Therefore, printing of ₹2000 banknotes was stopped in 2018-19.
2. About 89% of the ₹2000 denomination banknotes were issued prior to March 2017 and are at the end of their estimated life-span of 4-5 years. The total value of these banknotes in circulation has declined from ₹6.73 lakh crore at its peak as on March 31, 2018 (37.3% of Notes in Circulation) to ₹3.62 lakh crore constituting only 10.8% of Notes in Circulation on March 31, 2023. It has also been observed that this denomination is not commonly used for transactions. Further, the stock of banknotes in other denominations continues to be adequate to meet the currency requirement of the public.
3. In view of the above, and in pursuance of the “Clean Note Policy” of the Reserve Bank of India, it has been decided to withdraw the ₹2000 denomination banknotes from circulation.
4. The banknotes in ₹2000 denomination will continue to be legal tender.
5. It may be noted that RBI had undertaken a similar withdrawal of notes from circulation in 2013-2014.
6. Accordingly, members of the public may deposit ₹2000 banknotes into their bank accounts and/or exchange them into banknotes of other denominations at any bank branch. Deposit into bank accounts can be made in the usual manner, that is, without restrictions and subject to extant instructions and other applicable statutory provisions.
7. In order to ensure operational convenience and to avoid disruption of regular activities of bank branches, exchange of ₹2000 banknotes into banknotes of other denominations can be made upto a limit of ₹20,000/- at a time at any bank starting from May 23, 2023.
8. To complete the exercise in a time-bound manner and to provide adequate time to the members of public, all banks shall provide deposit and/or exchange facility for ₹2000 banknotes until September 30, 2023. Separate guidelines have been issued to the banks.
9. The facility for exchange of ₹2000 banknotes upto the limit of ₹20,000/- at a time shall also be provided at the 19 Regional Offices (ROs) of RBI having Issue Departments1 from May 23, 2023.
10. The Reserve Bank of India has advised banks to stop issuing ₹2000 denomination banknotes with immediate effect.
11. Members of the public are encouraged to utilise the time up to September 30, 2023 to deposit and/or exchange the ₹2000 banknotes. A document on Frequently Asked Questions (FAQs) in the matter has been hosted on the RBI website for information and convenience of the public.
(Yogesh Dayal)
Chief General Manager
Press Release: 2023-2024/257
objective : Rs 2000 denomination banknote
The objective behind introducing the ₹2000 denomination banknote in November 2016 was primarily to facilitate high-value transactions and reduce the need for carrying a large number of lower denomination notes. Here are some of the objectives associated with the ₹2000 banknote:
Curbing Black Money: The demonetization drive aimed to curb the circulation of unaccounted wealth or black money in the economy. By introducing a higher denomination note, it became more difficult to hoard large sums of illicit cash.
Enhancing Efficiency: The ₹2000 note aimed to make transactions more convenient for individuals and businesses involved in high-value transactions. It reduced the need for carrying bundles of smaller denomination notes and streamlined financial transactions.
Countering Counterfeit Currency: The new ₹2000 banknote incorporated advanced security features to deter counterfeiting and protect the integrity of the currency. These security features were designed to make it easier for individuals and businesses to verify the authenticity of the note.
Encouraging Digital Economy: Another objective was to promote digital transactions and move towards a cashless economy. By introducing higher denomination notes, it was expected to encourage people to adopt digital payment methods and reduce the dependence on cash.
It’s important to note that the specific objectives and policies related to the ₹2000 banknote may have evolved or changed over time. For the most up-to-date information, I recommend referring to reliable sources or official announcements from the Reserve Bank of India (RBI) or the Indian government.
What should you do your Rs 2000 denomination banknotes?
Deposit in Bank Accounts: If you have a bank account, you can deposit the ₹2000 banknotes into your account. Most banks accept cash deposits, and you can visit your nearest branch to deposit the notes.
Exchange at Banks: In case there are any specific guidelines or instructions from the Reserve Bank of India (RBI) or the Indian government regarding the ₹2000 banknotes, such as demonetization or withdrawal, you can visit a bank and follow the prescribed procedures for exchanging or replacing them.
Withdraw Lower Denominations: If you prefer to hold lower denomination notes for day-to-day transactions, you can visit a bank or ATM and withdraw smaller denominations using your ₹2000 banknotes.
Check for Updates: Stay informed about any official announcements or guidelines related to the ₹2000 banknotes. Keep an eye on news sources, RBI notifications, or updates from your bank to ensure you are aware of any changes or specific instructions.
Remember, currency-related policies can change over time, so it’s advisable to stay updated and follow the guidelines provided by the relevant authorities.
FAQ
official announcements from the Reserve Bank of India (RBI), The ₹2000 denomination banknote was introduced in November 2016 under Section 24(1) of RBI Act, 1934 primarily with the objective to meet the currency requirement of the economy in an expeditious manner after withdrawal of the legal tender status of all ₹500 and ₹1000 banknotes in circulation at that time. With fulfilment of that objective and availability of banknotes in other denominations in adequate quantities, printing of ₹2000 banknotes was stopped in 2018-19. A majority of the ₹2000 denomination notes were issued prior to March 2017 and are at the end of their estimated life-span of 4-5 years. It has also been observed that this denomination is not commonly used for transactions. Further, the stock of banknotes in other denominations continue to be adequate to meet the currency requirement of the public.
In view of the above, and in pursuance of the “Clean Note Policy” of the Reserve Bank of India, it has been decided to withdraw the ₹2000 denomination banknotes from circulation.
The Clean Note Policy refers to a set of guidelines and practices implemented by central banks and financial institutions to maintain the quality and integrity of banknotes in circulation. The policy aims to ensure that the banknotes in circulation are clean, free from damage, and fit for circulation. Here are some key aspects of the Clean Note Policy:
Quality Standards: The Clean Note Policy sets specific quality standards for banknotes in terms of cleanliness, physical condition, and fitness for circulation. These standards may include criteria such as the absence of tears, stains, excessive creases, and graffiti on the banknotes.
Withdrawal of Unfit Notes: Under the Clean Note Policy, central banks periodically withdraw damaged, mutilated, or unfit banknotes from circulation. These banknotes are typically replaced with new, clean banknotes to maintain the quality of currency in circulation.
Exchange and Replacement: The policy outlines the procedures for individuals and banks to exchange or replace damaged or unfit banknotes. This ensures that the public has access to clean and usable currency.
Public Awareness: Central banks often undertake public awareness campaigns to educate the public about the importance of handling banknotes with care and returning damaged or soiled banknotes to banks for exchange or replacement.
The specific details and implementation of the Clean Note Policy can vary from country to country, as it is typically set by the respective central bank or monetary authority. It is aimed at maintaining the overall quality, integrity, and usability of banknotes in circulation, promoting public confidence in the currency, and preventing counterfeiting.
Yes. The ₹2000 banknote will continue to maintain its legal tender status.
Yes. Members of the public can continue to use ₹2000 banknotes for their transactions and also receive them in payment. However, they are encouraged to deposit and/or exchange these banknotes on or before September 30, 2023.
Members of the public may approach bank branches for deposit and/or exchange of ₹2000 banknotes held by them.
The facility for deposit into accounts and exchange for ₹2000 banknotes will be available at all banks until September 30, 2023. The facility for exchange will be available also at the 19 Regional Offices (ROs) of RBI having Issue Departments1 until September 30, 2023.
Deposit into bank accounts can be made without restrictions subject to compliance with extant Know Your Customer (KYC) norms and other applicable statutory / regulatory requirements.
Members of the public can exchange ₹2000 banknotes upto to a limit of ₹20,000/- at a time.
Yes, exchange of ₹2000 banknotes can be made through BCs upto a limit of ₹4000/- per day for an account holder.
To give time to the banks to make preparatory arrangements, members of the public are requested to approach the bank branches or ROs of RBI from May 23, 2023 for availing exchange facility.
No. A non-account holder also can exchange ₹2000 banknotes up to a limit of ₹20,000/- at a time at any bank branch.
No. The exchange facility shall be provided free of cost.
To make the entire process smooth and convenient for the public, a period of over four months has been given for deposit and/or exchange of ₹2000 banknotes. Members of the public, are therefore, encouraged to avail this facility at their convenience within the allotted time.