398) Introduction
of the new denomination of Rs.2000/- in India currency circulation wef 10.11. 2016:
Fighting
Black Money in India:
After the recently closed Black
Money Voluntary Disclosure Scheme, which closed on end September 2016, the
Government of India has brought in a
major step on 08.11.2016 in its war against corruption, terrorism and black
money.
Before the present Government
took over the reins of Government about two years ago, India ranked around 100
in global rankings of corruption. Presently, it ranks 76th.
Black Money estimated at about
Rs.1.25 lakh crores has been brought back to India according to Indian Prime
Minister Narendra Modi. Nevertheless,
this is not an exemplary position to be in, as such, the Government has taken
some drastic measures:
The Indian Prime Minister
Narendra Modi in a televised address to the nation on 08.11.2016 evening announced
the demonetisation of the presently circulating higher denominations of
currency viz. Rs.500/- and Rs.1000/- with effect from the coming midnight i.e.
midnight of 08.11.2016. He stated that the Banknotes of these denominations
will “just be worthless pieces of
paper”. The Banknotes of all the lower denominations of Rs.100/-, Rs.50/-,
Rs.20/-, Rs.10/-, Rs.5/-, Rs.2/- and Re 1/- and all coins will continue to be
accepted as legal tender. In addition, new Banknotes in the denominations of
Rs.2000/- and Rs.500/- will be introduced.
Also,
there will be no change in any other form of currency exchange i.e. cheques,
Demand Drafts, credit card or debit card payments.
This has been necessitated
as the Government has been fighting the menace of black money and corruption
over the past two years when it was voted to power.
To
facilitate the smooth transition to the new money regime, Banks will be closed
on 09.11.2016.
Presently, Rs.500/- and
Rs.1000/- Banknotes which have been demonetised account for 86.4 % of the total
value of Banknotes which were in circulation as of 31.03.2016.
Introduction of the Rs.2000/- denomination Banknotes:
As on date, the four printing presses are working three shifts as against the normal two shifts every 24 hours.
This will definitely result in several processes being given a go by and several error notes being put into circulation.The machines will also get over-heated and result in break-downs.
Also, 11 years worth of High Denomination Banknotes representing about 86 % of currency in operation has been taken out. So far only 20% 2000/- Rupee Notes and 10% 500 Notes have been printed. The whole process will take a minimum of 7 to 10 months.
Long lines of harassed customers are queueing up at Banks and ATMs for urgent drawal of cash which is presently available in extremely short supply, for which daily/weekly limits have been set by the Ministry of Finance/Reserve Bank of India/individual Bank branches etc.
Introduction of the Rs.2000/- denomination Banknotes:
As on date, the four printing presses are working three shifts as against the normal two shifts every 24 hours.
This will definitely result in several processes being given a go by and several error notes being put into circulation.The machines will also get over-heated and result in break-downs.
Also, 11 years worth of High Denomination Banknotes representing about 86 % of currency in operation has been taken out. So far only 20% 2000/- Rupee Notes and 10% 500 Notes have been printed. The whole process will take a minimum of 7 to 10 months.
Long lines of harassed customers are queueing up at Banks and ATMs for urgent drawal of cash which is presently available in extremely short supply, for which daily/weekly limits have been set by the Ministry of Finance/Reserve Bank of India/individual Bank branches etc.
Reserve Bank of India has
yet to decide the limit for individuals for possession of Banknotes of higher value i.e. Rs.2000/- and
Rs.500/- which will be permitted for individual withdrawals, once the cash situation has eased up and sufficient pieces of currency notes have been put into circulation.
Meanwhile, credit card and debit card usage has increased tremendously - I saw a customer paying for a Rs.10/- biscuit packet with a credit card yesterday. He had no cash - not out of his progressive outlook, but because there was no money in the ATMs he visited.
Meanwhile, credit card and debit card usage has increased tremendously - I saw a customer paying for a Rs.10/- biscuit packet with a credit card yesterday. He had no cash - not out of his progressive outlook, but because there was no money in the ATMs he visited.
The
salient features of the new Rs.2000/- Banknotes are:
The Series is called
the Mahatma Gandhi (New) Series.
The Banknotes bear
the signatures of Dr. Urjit R. Patel, RBI Governor.
The year of printing has
started from 2016 which will be printed on the Back of the Banknote.
The new denomination has the motif of the "Mangalayan" on the Back, which is India's first venture in inter-planetary space.
The base colour of the Banknote is magenta .
The Banknote has other designs, geometric patterns aligning with the overall colour scheme, both on the Front and Back.
The new denomination has the motif of the "Mangalayan" on the Back, which is India's first venture in inter-planetary space.
The base colour of the Banknote is magenta .
The Banknote has other designs, geometric patterns aligning with the overall colour scheme, both on the Front and Back.
Other
important features of the Banknote:
On
the Front: See through Register with
denominational numeral 2000
Latent image
with denominational numeral 2000
Denominational numeral
2000 in Devnagri
Portrait of Mahatma Gandhi
at the centre
Micro letters
“RBI” and “2000” on the left side of the Banknote
Windowed security thread
with inscriptions “Bharat” (in Hindi), RBI and 2000 on Banknotes with colour
shift. Colour of the thread changes from green to blue when the Banknote is
tilted
Guarantee Clause, RBI
Governor’s signature with Promise Clause and RBI emblem
towards the right
Denominational numeral
with Rupee symbol “R 2000” in colour changing ink (green to blue) on bottom
right, Ashoka Pillar emblem on the right.
Watermarks: Mahatma
Gandhi portrait and electrotype (2000).
Number panel with
numerals growing from small to big on the top left side and bottom right side
For visually impaired:
Intaglio or raised
printing of Mahatma Gandhi portrait, Ashoka Pillar emblem, Bleed lines and
identity marks.
Horizontal rectangle with
“R2000” in raised print on the right.
Seven angular bleed lines
on the left and right side in raised print
Some features on the Back:
Year of printing
on the Banknote on the left
“Swachh Bharat” logo
with slogan
Language Panel
towards the centre
Motif of Mangalyaan
Denominational numeral
“2000” in Devnagri
Size/Dimensions
of the Banknote: 166 mm x 66 mm
The Front of a Two Thousand Rupees Banknote issued with a "Plain Inset" and the Serial number 8AD 020761 shows a portrait of Mahatma Gandhi with has been shifted to the Centre.
The Back of the above Banknote shows the year of issue as 2016 on the left side (shifted from the bottom of the Banknote as in other denominations in circulation. The slogan "Ek Kadam Swacchata Ki Ore" (A step towards cleanliness) appears on the left bottom. The predominant image is of the Mars Orbiter Mission (MOM) titled "Mangal Yaan" (meaning "Mars SpaceCraft")
Posted on 21.02.2017:
Yesterday, I have acquired the following Banknote of Rs.2000/- which has been issued by the Reserve Bank of India in 2017. The intriguing part about this issue is that no RBI "Press Notification" has been issued/posted on the RBI website till yesterday evening, as per the normal practice followed by RBI:
Posted on 02.07.2017:
Yesterday, I drew some money from an ATM which was one of the first few in the locality to start dispensing money after demonetisation of Rs.1,000/- Banknotes and the old design issues of Rs.500/- Banknotes in November 2016.
There is a rumour being circulated on "WhatsApp" groups that the Banks are slowly withdrawing Rs.2,000/- denomination Banknotes and flooding Rs.500/- denomination Banknotes into general circulation (ostensibly for the purpose of dissuading unscrupulous persons from "hoarding" Black Money in the larger denomination). Well, this ATM gave me only crisp Rs.2,000/- denomination Banknotes all printed in 2017, which should put the rumour to rest:
Posted on 21.05.2023:
On 19.05.2023, the Reserve Bank of India has announced the withdrawal of the Rs. 2,000 Bank note from circulation with the user public being asked to deposit or exchange the Banknotes at bank branches until 30.09.2023.
Even after the 30.09.2023 deadline, the denomination will remain legal tender. (A bit confusing. If it will remain legal tender after the deadline, why the urgency to meet the deadline? How can there be two sets of rules for this denomination - It remains legal tender but cannot be deposited in Banks after the deadline ends?).
The reason being cited is lack of use and the fact that the Banknotes were nearing the end of their four-five-year lifecycle as the reasons for withdrawal. (If the RBI was serious about the introduction of this denomination, then why did it stop printing this Banknote sometime in 2018 so as to maintain continuity in the lifecycles of new prints while phasing out the old ones. After all the Rs.2,000 and Rs.200 Banknote denominations were introduced in line with the Renard Series/progression in 2016.
If the intention was to have a "limited circulation of this denomination to meet the requirements of the economy" - then how did it meet the emergent requirements after demonetisation is not very clear. The RBI circular given below seems to be hedging on the utility and the enormous cost factor involved in introducing this denomination.).
The Renard Series:
In order to determine currency denominations, the Reserve Bank of India follows a variation of the Renard series, called the 1-2-5 series, in which a ‘decade’ or a 1:10 ratio is covered in 3 steps, such as 1-, 2-, 5-, 10-, 20-, 50-, 100-, 200-, 500-, 1,000, 2,000 etc.
The Reserve Bank of India circular on the Rs.2,000 denomination being withdrawn from circulation:
"RBI/2023-24/32
DCM(Plg) No.S-236/10.27.00/2023-24
May 19, 2023
The Chairman / Managing Director/ Chief Executive Officer
All Banks
Dear Sir/Madam,
₹2000 Denomination Banknotes – Withdrawal from Circulation; Will continue as Legal Tender
₹2000 denomination banknote was introduced in November 2016 under Section 24(1) of RBI Act, 1934 primarily to meet the immediate currency requirement of the economy after withdrawal of the legal tender status of all ₹500 and ₹1000 banknotes in circulation at that time.
With fulfilment of the objective of introduction of ₹2000 denomination and availability of banknotes in other denominations in adequate quantity, printing of ₹2000 banknotes was stopped in 2018-19.
2. Further, majority of the ₹2000 denomination notes were issued prior to March 2017, have completed their estimated lifespan and are not observed to be commonly used for transactions anymore.
Therefore, it has been decided that, in pursuance of the “Clean Note Policy” of the Reserve Bank of India, the ₹2000 denomination banknotes shall be withdrawn from circulation.
The ₹2000 banknotes will continue to be legal tender.
3. Accordingly, to implement the decision stated above, the following plan of action has been formulated which, the banks shall follow meticulously:
A. Handling of existing stock and receipts:
All banks shall discontinue issue of ₹2000 denomination banknotes with immediate effect. ATMs/Cash Recyclers may also be reconfigured accordingly.
Banks holding Currency Chests (CCs) shall ensure that no withdrawal of ₹2000 denomination is allowed from the CCs. All balances held in the CCs shall be classified as unfit and kept ready for dispatch to respective RBI offices.
All banknotes in this denomination received by the banks shall be sorted immediately through Note Sorting Machines (NSMs) for accuracy and genuineness and deposited in the currency chests under the Linkage Scheme or kept ready for dispatch to the nearest Issue Office of RBI.
The instructions contained in our Master Direction dated April 03, 2023 on detection, reporting and monitoring of counterfeit notes shall be meticulously followed.
B. Facility for Deposit and Exchange:
The facility for deposit and/or exchange of ₹2000 banknotes shall be available for members of the public up to September 30, 2023.
Deposit of ₹2000 banknotes into accounts maintained with all banks can be made in the usual manner, that is, without restrictions and subject to compliance with extant Know Your Customer (KYC) norms and other applicable Statutory requirements.
The banks shall also be required to comply with Cash Transaction Reporting (CTR) and Suspicious Transaction Reporting (STR) requirements, where applicable.
The facility for exchange of ₹2000 banknotes shall be provided to all members of the public by all banks through their branches.
With a view to minimise inconvenience to the public, to ensure operational convenience and avoid disruption of the regular activities of bank branches, all banks may exchange ₹2000 banknotes upto a limit of ₹20,000/- at a time.
Business Correspondents (BCs) may also be allowed to exchange ₹2000 banknotes upto a limit of ₹4000/- per day for an account holder. For this purpose, banks may, at their discretion, enhance the cash holding limits of BCs.
To give time to the banks for preparatory arrangements, members of the public have been requested to approach the banks/branches from May 23, 2023 for availing exchange facility. Deposit of ₹2000 banknotes may continue as per the normal banking practice.
For providing deposit / exchange facility to people residing in remote/ unbanked areas, banks may consider using mobile vans, if necessary.
While crediting the value of ₹2000 notes to Jan Dhan Yojna Accounts / Basic Savings Bank Deposit (BSBD) Accounts, the usual limits will apply mutatis mutandis.
The banks shall to the extent feasible make special arrangements to reduce inconvenience to the senior citizens, persons with disabilities and women seeking to exchange/deposit ₹2000 notes.
C. Replenishment of Stock of Other Denominations for Exchange:
Branches / CCs should estimate their cash requirement and obtain banknotes of other denominations from the linked / nearby currency chest / RBI well in time.
CC holding branches shall extend required support to the linked / non-linked branches in accepting ₹2000 notes and distribution of banknotes in other denominations. In case of any difficulty in obtaining cash, the banks may contact the concerned Issue Office of RBI.
D. Dissemination of Information:
The banknotes in ₹2000 denomination will continue to be legal tender.
A document on Frequently Asked Questions (FAQs) in the matter has been prepared and given in the Annex.
A copy of the same may be provided to the staff manning the exchange counters as well as displayed in the banking hall, ATM kiosks, etc.
A Press Release informing the public of the exercise and soliciting their co-operation is being issued separately. A copy of the same is enclosed for ready reference which may also be displayed in the banking hall, ATM kiosks, etc.
Banks may also consider advising their customers suitably in the matter.
4. The above instructions will be effective until September 30, 2023.
5. You are requested to issue suitable instructions to the branches and advise them to extend all cooperation to members of the public so that the exercise is conducted in a non-disruptive manner, without any inconvenience to the public.
6. Please acknowledge receipt.
Yours faithfully
(Suman Ray)
Chief General Manager in-Charge
Links to other posts on Indian Currency denominations on this blog:
1) Introduction of the new Rs.2000/- denomination in Indian Currency circulation wef 10.11.2016
Classification and Valuation of Rs.500/- Notes
Classification and Valuation of Rs.100/- Notes
Classification and Valuation of Rs.50/- Notes
Classification and Valuation of Rs.20/- Notes
Classification and Valuation of Rs.10/- Notes
Classification and Valuation of Rs.5/- Notes
Did-you-know-series-1: Assists for identification of Currency Notes by visually challenged users
Did-you-know-series-2-what-is-design-or focus of the picture at the back of circulating Currency Notes in India?
Are you carrying a Fake Rs.500/- Banknote in your purse/wallet?: A comprehensive study
Any info on which banknote (of India/world) was legal tender for the least duration and likewise for the longest duration?
ReplyDeleteThanks.
~bd
On the issue of withdrawing the Rs.2,000 Banknote:
ReplyDeleteRajan Trikha has commented:
"Very confusing communication in public domain and still unaware about the internal instructions circulated to Banks😤"
It seems to be a hastily conceived scheme as of now.
DeleteRajan Trikha has further commented:
Delete"It is so much like the original one."
Raj Kumar Srivastava has commented:
ReplyDelete"How much money is being lost as cost of printing and circulating and now withdrawing this note? I wonder."
It seems to be a thoughtless expensive exercise altogether. It was a non starter to begin with.
DeleteRaj Kumar Srivastava has further commented:
Delete"I agree."
Ram Lalingkar has commented:
ReplyDelete"I think, after 30-09-2023 such notes will be accepted on RBI counters only. Means, who so ever has left with such notes he will have to go to RBI counter, fill up some form & get notes exchanged if able to convince the RBI officials why he could not deposit the notes before 30-09-23. Such incidences will be rare, I hope.
The real intention behind this excercise may be to check the holding of black money, as also to check influx of counterfeit currency being influxed by countries like Pakistan & Bangla Desh, I guess."
Thank you so much Rambhau for this interesting insight. We are waiting to see further developments as things go along.
Delete