Rs 2000 currency note ban: From "timely and prudent" to "first act, second think" — here's how industry and political parties reacted to RBI guideline

Latest RBI Guideline for banks: The Reserve Bank of India's announcement to withdraw of Rs 2,000 currency notes from circulation on Friday, received a mixed bag of reactions from the industry and political parties. While some industrialists saw it long coming, the Opposition chose the occasion to lampoon Prime Minister Narendra Modi-led government in the Centre. 

Here are some of the prominent reactions — 

Former Reserve Bank Deputy Governor R Gandhi said that withdrawal of the Rs 2,000 bank notes will help in curbing black money to a "great extent" because people are hoarding the high value currency. Gandhi, who was leading the currency department during the demonetisation of 2016, told PTI that any systemic impact on payments is unlikely because the notes are not used in day-to-day payments, which mostly go through in a digital manner.

Vimal Nadar, Head of Research at Colliers India, said that the noteban was on expected lines. He added, ""The withdrawal of INR 2000 rupee-denominated notes is an expected and timely move towards prudent currency management within the realm of maintaining banking & financial discipline. Such measures further reduce/ eliminate the probable cash component in high-value real estate transactions. In the last few years, RERA & demonetisation have brought in significant levels of transparency in real estate, mainly contributing to fair market price determination."

Also Read - RBI makes big announcement regarding Rs 2,000 currency notes: Banks told to stop issuing banknotes immediately

Principle Opposition party Congress has targetted PM Modi over withdrawal of Rs 2,000 currency notes from circulation. The grand-old-party has aid that the move is "typical of our self-styled vishwaguru" and his method of "first act, second think."

Congress MP Manickam Tagore tweeted, "Second Demo disaster starts .. M = Madness."

Former Finance Minister P Chidambaram tweeted saying demonetisation has come full circle with the move to ban Rs 2000 currency notes. He tweeted: "As expected, the government/RBI have withdrawn the Rs 2000 note and given time until September 30 to exchange the notes. The Rs 2000 note is hardly a popular medium of exchange. We said this in November 2016 and we have been proved correct. The Rs 2000 note was a band-aid to cover up the foolish decision of demonetising Rs 500 and Rs 1000 notes which were popular and widely exchanged currencies."

"A few weeks after Demonetisation, the government/RBI were forced to re-introduce the Rs 500 note. I shall not be surprised if the government/RBI re-introduced the Rs 1000 note as well. Demonetisation has come full circle!" he added.

As expected, the government/RBI have withdrawn the Rs 2000 note and given time until September 30 to exchange the notes

The Rs 2000 note is hardly a popular medium of exchange. We said this in November 2016 and we have been proved correct

The Rs 2000 note was a band-aid to…

— P. Chidambaram (@PChidambaram_IN) May 19, 2023

Also Read - Bye bye, Rs 2,000 banknote! Key features of the bill that remained in circulation for just 6 years

Earlier on Friday, RBI announced the ban and mentioned that the Rs 2,000 denomination bank notes will continue to be a legal tender till September 30. 

The central bank has asked the public to deposit Rs 2,000 bank notes into their bank accounts and/or exchange them into banknotes of other denominations at any bank branch.

"Members of the public are encouraged to utilise the time up to September 30, 2023 to deposit and/or exchange the Rs 2,000 bank notes," the central bank said.