The Reserve currency of India said on Friday that it has unexpectedly decided to stop issuing Rs 2,000 currency notes. However, the RBI stated that Rs 2,000 banknotes will still remain accepted as legal money. The RBI declared that it has instructed banks to cease producing Rs 2,000 notes immediately.
The Reserve Bank of India stated that “banknotes in other denominations can be obtained in adequate quantities” as justification for the decision. According to the RBI, these notes must be exchanged at banks by September 30, 2023, or earlier.
“The general public may continue to conduct transactions with and accept payment with Rs 2,000 banknotes. However, the RBI recommended them to deposit and/or swap these notes by September 30, 2023, at the latest.
Reserve Bank of India announced
The Reserve Bank of India announced that it had decided to remove the Rs 2,000 denomination bank notes from circulation in accordance with its “Clean Note Policy.”
The decision was made in response to worries that the biggest denomination notes would be used to store illicit money. In 2018–19, the RBI ceased producing the Rs 2,000 notes since they were seldom ever used.
The 2,000 rupee note has served its purpose, according to Finance Secretary TV Somanathan, and it’s time to switch to lesser amounts. Our goal is to promote online commerce. The Rs. 2,000 note is still valid tender.
The public is being urged by the central bank to deposit their Rs. 2,000 banknotes into their accounts or to swap them for other banknotes at any bank branch, both of which are free of charge.
The RBI stated that deposits into bank accounts may be made normally, that is, without limits and subject to current directives and other relevant legislative conditions. Additionally, up to a maximum of Rs 4,000 per day for an account holder, exchanges of Rs 2,000 banknotes are permitted through Business Correspondents.
The RBI stated, “Starting May 23, 2023, exchanges of Rs 2,000 bank notes into bank notes of other denominations can be done up to a maximum of Rs 20,000 at a time at any bank in order to maintain operational convenience and to prevent disrupting routine activities of bank branches.
Additionally, starting on May 23, 2023, the 19 Regional Offices (ROs) of the RBI with Issue Departments will offer the ability to swap notes for up to 20,000 rupees each.
The RBI announced the removal from circulation of all banknotes printed before 2005 in January 2014.
“Around 89% of the Rs 2,000 banknotes were produced before March 2017 and are nearing the conclusion of their 4-5 year expected lifespan. The entire value of these banknotes in circulation has decreased from Rs 6.73 lakh crore, which represented 37.3% of all notes in circulation as of March 31, 2018, to Rs 3.62 lakh crore, which will make up just 10.8% of all notes by that date.
In addition, it has been noted that transactions involving this denomination are uncommon. Additionally, the supply of banknotes in other denominations continues to be sufficient to satisfy the public’s need for money, according to a statement from the RBI.
“After September 30, the Rs. 2,000 note will still be accepted as lawful cash. According to the RBI, four months should be sufficient for consumers to exchange notes with banks. The majority of the Rs 2,000 notes that are now in use will be returned to banks by September 30.
People shouldn’t worry because this is a regular action by the RBI, according to government officials reported by ANI minutes after the highest-denomination currency was taken out of circulation.
The introduction of the Rs 2,000 denomination banknote in November 2016 was largely to quickly address the economy’s need for money following the removal of the legal tender status of the Rs 500 and Rs 1,000 banknotes in use at the time.
“Starting from May 23, 2023, exchanges of Rs 2,000 banknotes into banknotes of other denominations can be made up to a limit of Rs 20,000 at a time at any bank, to ensure operational convenience and prevent disruption of regular activities of bank branches,” RBI stated.
As was the situation with the introduction of the new currency, Karthik Srinivasan, Senior Vice President of Financial Sector Ratings at ICRA, stated: “In the near future, we anticipate a little improvement in the deposit accretion of banks. This will relieve the pressure on deposit rate increases and may also cause short-term interest rates to moderate.
What happens to your notes? Watch: Rs 2,000 denomination banknotes abolished, will remain legal tender. Understand the RBI’s guidance on exchange and deposits of Rs 2,000 notes
Can the withdrawal of the Rs 2,000 note by the RBI be referred to as demonetization? Answering the question is challenging. Actually, no. Because the RBI is not rendering the notes worthless, it is not a demonetization. The plan is for RBI to confiscate and maybe destroy all of the Rs 2,000 notes now in circulation.
The RBI’s most significant chance for achievement is that after September 30 there won’t be any Rs 2,000 notes floating all through the economy since it would have recovered every penny.
What you should know about the elimination of the 2000 note
FAQS about 2000 rupees bank note
Why are banknotes with a 2000 denomination being withdrawn?
The introduction of the 2000-denomination banknote in November 2016 was made possible by Section 24(1) of the RBI Act, 1934, with the primary goal of quickly addressing the economy’s need for currency following the withdrawal of the legal tender status of all 500- and 1000-denomination banknotes in use at the time. The printing of notes in the denomination of 2000 was discontinued in 2018–19 due to the achievement of that goal and the availability of notes in other denominations in sufficient quantities. The majority of the 2000-denomination notes were printed before March 2017 and are nearing the end of their 4-5-year expected lifespan. Additionally, it has been noted that transactions involving this denomination are uncommon. Additionally, the supply of banknotes in other denominations is still sufficient to fulfil the public’s demand for cash. In light of the foregoing and in accordance with the Reserve Bank of India’s “Clean Note Policy,” it has been decided to stop issuing banknotes with the denomination of 2000.
Can regular transactions be made using 2000 yen notes?
Yes. The general public can still use 2000 yen banknotes in everyday transactions and in exchange for goods and services. On or before September 30, 2023, they are urged to deposit and/or exchange their banknotes.
Is there a restriction on how many 2000 yen notes may be deposited into a bank account?
Subject to adherence to current Know Your Customer (KYC) norms and other applicable statutory/regulatory requirements, deposits into bank accounts may be made without limitations.
When will the exchange facility be operational?
The general public is urged to contact bank branches or RBI ROs starting on May 23, 2023, in order to take advantage of the exchange facility while the banks are still able to make necessary preparations.
What will happen if a bank declines to accept or exchange a deposit of a 2000 banknote?
In the event of poor service, the dissatisfied the customer should first contact the relevant bank for redress of grievance. The complaint can be filed under the Reserve Bank – Integrated Ombudsman Scheme (RB-IOS), 2021, at the Complaint Management System portal of RBI (cms.rbi.org.in), if the bank does not respond within 30 days after receiving the complaint or if the complainant has a problem with the response or resolution provided by the bank.
Is a customer of the bank required in order to exchange 2000 banknotes at one of its branches?
No, a non-account holder can swap 2000 rupee bills at a time at any bank branch, up to a maximum of 20,000 rupees.
Will there be specific exchange and deposit provisions for older citizens, those with impairments, etc.?
In order to minimise the inconvenience for older citizens, people with disabilities, etc. who want to exchange or deposit 2000 banknotes, banks have been directed to make the necessary arrangements.
What is Clean Note Policy?
To guarantee that the general population has access to high-quality banknotes, the RBI has enacted this policy.
What if a person requires more than 20,000 in cash for personal or professional reasons?
Account deposits are permissible without limitations. The 2000 banknotes may be put into bank accounts, after which cash withdrawals can be made to meet your needs. Mumbai, Nagpur, New Delhi, Patna, Thiruvananthapuram, Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur, Jammu, Kanpur, Kolkata, Lucknow, and Bangalore
Do 2000 rupees bills still qualify as lawful tender?
Yes. The 2000 banknote will still be acknowledged as legal currency.
What will happen if a 2000 currency bill cannot be deposited or exchanged right away?
A window of more than four months has been provided for the deposit and/or exchange of 2000-yen banknotes in order to make the procedure seamless and comfortable for the general public. The general public is thus urged to use this amenity whenever it is convenient within the allocated period.
What should the general population do with the Rs 2000 bills they now possess?
The general public is welcome to visit bank branches to deposit and/or exchange any 2000-yen banknotes they may have. All banks will still offer the ability to deposit money into accounts and exchange them for 2000 rupee banknotes till September 30, 2023. The exchange service will also be accessible at the 19 RBI Regional Offices (ROs) with Issue Departments till
Does the exchange facility require payment in any way?
No, the exchange facility must be offered without charge.
Are Business Correspondents (BCs) an option for exchanging 2000 rupee notes?
Yes, up to a maximum of 4,000 per day for an account holder, exchanges of 2,000 banknotes can be done using BCs.
Does the number of 2000 yen bills that can be exchanged have a practical cap?
2000 banknotes can be exchanged by the general public up to 20,000/- at a time.
