Rs 2,000 bill withdrawal: Ample notes in circulation, RBI prepared to allay public's concerns, says Shaktikanta Das

Rs 2,000 note withdrawal from circulation: RBI Governor Shaktikanta Das said the withdrawal of Rs 2,000 banknotes from circulation is part of the central bank's currency management policy and reiterated that the bill will remain legal tender. "The RBI has been following the clean note policy... From time to time, the RBI withdraws notes of a particular series and issues fresh notes," he told reporters. His remarks came on the backdrop of the RBI announcing a sudden withdrawal of Rs 2,000 currency notes, in a move widely expected to boost bank deposits at a time of high credit growth.

"The Rs 2,000 note has served its purpose... Hope most of Rs 2,000 notes will return to the banks by September," he said.   

Das also said there is ample time for the public to exchange the Rs 2,000 bills. 

ALSO READ: Rs 2,000 notes withdrawn from circulation: Don't panic, this is NOT demonetisation

"There are enough notes (of other denominations) in the system... There is no need to worry or panic. You can easily and conveniently return or exchange the Rs 2,000 note within the deadline," the RBI Governor said.

Last week, while announcing the withdrawal of the Rs 2,000 note, the RBI said the highest denomination is not being commonly used for transactions. It also said the notes will remain legal tender, asking people to deposit their notes, or exchange them for smaller denominations by September 30 up to Rs 20,000 (10 notes) at a time.

Finance Secretary TV Somanathan said the withdrawal of the highest denomination bill will not cause disruption "either in normal life or in the economy". 

"The stock of banknotes in other denominations continues to be adequate to meet the currency requirement of the public," the RBI added in a statement.

ALSO READ: From "timely and prudent" to "first act, second think" — here's how industry and political parties reacted to RBI action on Rs 2,000 currency notes

Key things to know about the Rs 2,000 currency note 

The Rs 2,000 was introduced in 2016 after the government abruptly withdrew Rs 500 and Rs 1,000 denominations, a move popularly known as demonetisation that was aimed at removing forgeries from circulation.

The government began issuing new Rs 500 notes days after the note ban, and announced the printing of Rs 2,000 banknotes to counter a vacuum created in circulation at a faster pace.

ALSO READ: Bye bye, Rs 2,000 banknote! 10 things to know about the bill that has been in circulation for 6 years

The central bank has focused on printing Rs 500 notes since. It has printed no new Rs 2,000 notes in the last four years.

Commercial banks in the country have been enjoying double-digit credit growth over the past few months, notwithstanding hikes totally 250 basis points in benchmark interest rates since May 2022 to counter inflation. The RBI, however, paused its current cycle of tightening monetary policy in a scheduled bi-monthly review in April. 

Catch latest stock market updates here. For all other news related to business, politics, tech, sports and auto, visit Zeebiz.com.