On Monday, Shaktikanta Das, the governor of the Reserve Bank of India, emphasized that there are no intentions to reintroduce ₹1,000 currency notes. Speaking to the media regarding the RBI’s recent decision to withdraw ₹2,000 currency notes, Das stated that the impact on the economy would be minimal as it represents just 10.8 percent of the total currency in circulation.
When queried about the possibility of bringing back ₹1,000 currency notes, Das replied, “That is speculative. At present, there is no plan or proposal for such an action.”
The governor stressed that the availability of ₹500 and ₹100 denominations is plentiful and easily accessible to the public, eliminating concerns about the central bank’s ability to function without the highest-value currency in India.
He highlighted the substantial quantity of printed notes already in circulation, emphasizing their availability not only within the Reserve Bank of India but also in the currency chests managed by banks.
Das reaffirmed that ₹2,000 notes will remain legal tender despite the RBI’s decision to withdraw them from circulation. He urged the public not to rush to bank branches, expressing his belief that there is no urgent need for people to visit banks.
Regarding the impact of withdrawing ₹2,000 notes, the RBI governor stated that it would have no effect on economic activity. He supported his statement with personal experience and informal surveys indicating the limited usage of ₹2,000 notes in day-to-day transactions.
According to a report by news agency PTI, 89 percent of the ₹2,000 denomination banknotes were issued before March 2017 and have now reached the end of their estimated lifespan of four to five years.
The total value of these banknotes in circulation has significantly declined from its peak of ₹6.73 lakh crore on March 31, 2018 (accounting for 37.3 percent of the total notes in circulation) to ₹3.62 lakh crore, which now represents a mere 10.8 percent of the total Notes in Circulation as of March 31, 2023.
Starting from Tuesday, the process of exchanging or depositing ₹2,000 currency notes will be initiated, and the deadline for this exchange is set by the RBI as September 30. Individuals will be allowed to exchange a maximum of 10 currency notes at a time. Additionally, the existing requirement of providing PAN (Permanent Account Number) for deposits of ₹50,000 or more will also be applicable to ₹2,000 notes.
It is worth mentioning that the State Bank of India has made an announcement stating that no identification proof or requisition slips will be required for exchanging ₹2,000 notes. In preparation for the summer season, the RBI has instructed banks to arrange appropriate infrastructure at their branches, including shaded waiting areas and drinking water facilities. Banks are also mandated to maintain daily records of the deposit and exchange of ₹2,000 banknotes.
However, the governor of the central bank indicated that the September deadline may be reevaluated depending on the current circumstances.
