“RBI Announces Withdrawal of ₹2000 Denomination Banknotes from Circulation”
Mumbai, May 19, 2023: The Reserve Bank of India (RBI) has announced the withdrawal of the ₹2000 denomination banknotes from circulation. However, these banknotes will continue to be recognized as legal tender. The decision comes as the objective of meeting immediate currency requirements following the demonetization of ₹500 and ₹1000 notes in 2016 has been achieved, and an adequate supply of banknotes in various denominations is now available.
Under the new guidelines, banks holding Currency Chests (CCs) will no longer permit withdrawals of the ₹2000 denomination. All balances of these banknotes held in the CCs will be classified as unfit and prepared for dispatch to the respective RBI offices. Banks are instructed to immediately sort all received ₹2000 banknotes through Note Sorting Machines (NSMs) to ensure accuracy and authenticity. The sorted banknotes should be deposited in the currency chests under the Linkage Scheme or prepared for dispatch to the nearest RBI Issue Office.
The RBI has also outlined the facility for the deposit and exchange of ₹2000 banknotes for the general public. The facility will be available until September 30, 2023. Individuals can deposit these banknotes into their bank accounts in the usual manner, without any restrictions, and subject to compliance with Know Your Customer (KYC) norms and other applicable statutory requirements. Banks are required to comply with Cash Transaction Reporting (CTR) and Suspicious Transaction Reporting (STR) requirements, where applicable.
To ensure convenience for the public, all banks are directed to provide exchange services for ₹2000 banknotes through their branches. The exchange limit is set at ₹20,000 at a time to avoid disruption to regular banking activities. Business Correspondents (BCs) may also be authorized to exchange ₹2000 banknotes up to a limit of ₹4000 per day for account holders, with banks having the discretion to enhance the cash holding limits of BCs.
To facilitate the process, banks are encouraged to consider using mobile vans for exchange and deposit facilities in remote or unbanked areas. Special arrangements should also be made to reduce inconvenience for senior citizens, persons with disabilities, and women seeking to exchange or deposit ₹2000 banknotes.
The RBI emphasizes the importance of replenishing the stock of other denominations for exchange purposes. Branches and Currency Chests should estimate their cash requirements and obtain banknotes of different denominations from linked or nearby currency chests or the RBI well in advance.
The central bank has prepared a document of Frequently Asked Questions (FAQs) regarding the withdrawal, which should be provided to staff manning the exchange counters and displayed in banking halls and ATM kiosks for public reference. A press release has also been issued to inform the public about the exercise and solicit their cooperation.
The withdrawal of ₹2000 banknotes will be effective until September 30, 2023. Banks are advised to issue appropriate instructions to their branches and ensure seamless cooperation with the public to minimize any disruption during this transition period.
For more information, kindly visit the official website of the Reserve Bank of India at www.rbi.org.in.
