Today, October 7, is the deadline for the public to avail exchange or to deposit Rs 2,000 banknotes. About Rs 12,000 crore (or 3.37 per cent) of the currency notes remains in circulation, the Reserve Bank of India Governor Shaktikanta Das said during the monetary policy review meeting on Friday, October 6.

COMMERCIAL BREAK
SCROLL TO CONTINUE READING

This essentially means over 96 per cent of the total value of Rs 2,000 banknotes are back in the banking system.

"We have announced the withdrawal of Rs 2,000 notes. So far, we have got back about 3.43 lakh crore and only about 12,000 crore or so are left. Of course, 87 per cent of it has come as bank deposits, and the rest is exchange of cash with other denominations over the counter," RBI Governor Shaktikanta Das told reporters after the monetary policy review meeting, responding to a query on the status of liquidity in the system.

At the close of business on May 19, 2023 - the day on which the RBI decided to abolish the currency - the total value of Rs 2,000 banknotes in circulation was Rs 3.56 lakh crore. In effect, the entire value of Rs 2,000 banknotes returned to the system following the statement on May 19 is Rs 3.44 lakh crore.

Initially, September 30 was set as the deadline in order to complete the exchange and deposit exercise on time and to give the public enough time. People were encouraged to deposit or exchange their Rs 2,000 banknotes during the month of September to prevent a last-minute rush.

Based on an assessment, the RBI decided on September 30 to extend the deposit and exchange arrangement until October 7, 2023.

"With effect from October 8, 2023, banks shall stop accepting Rs 2,000 banknotes for credit to accounts or exchange to other denomination banknotes," RBI said.

How to exchange/return Rs 2,000 notes after the deadline

Rs 2,000 banknotes can continue to be exchanged by individuals or entities at the 19 RBI Issue Offices up to a limit of Rs 20,000 at a time; can tender Rs 2,000 banknotes for credit to their bank accounts in India for any amount; people within the country can also send Rs 2,000 banknotes through India Post, addressed to any of the 19 RBI Issue Offices for credit to their bank accounts in India.

RBI has on many occasions confirmed that Rs 2,000 banknotes will continue to be legal tender.

On May 19, the RBI decided to withdraw the Rs 2,000 denomination banknotes from circulation but said it would continue to remain as legal tender. However, RBI had advised banks to stop issuing such banknotes with immediate effect.

The Rs 2,000 denomination banknote was introduced in November 2016, primarily to meet the currency requirement of the economy in an expeditious manner after the withdrawal of the legal tender status of all Rs 500 and Rs 1000 banknotes in circulation at that time.

The objective of introducing Rs 2,000 banknotes was met once banknotes in other denominations became available in adequate quantities. Therefore, the printing of Rs 2,000 banknotes was stopped in 2018-19. 

With ANI inputs