NEW DELHI: The Reserve Bank of India has decided to withdraw the ₹2000 denomination banknotes from circulation but they will continue to remain as legal tender. Banks have been advised to stop issuing ₹2000 denomination banknotes with immediate effect. The move comes as a pursuance of ‘Clean Note Policy” of the Reserve Bank of India.
“The objective of introducing ₹2000 banknotes were met once banknotes in other denominations became available in adequate quantities,” RBI said in a statement.
“The printing of ₹2000 banknotes was stopped in 2018-19.About 89% of the ₹2000 denomination banknotes were issued prior to March 2017 and are at the end of their estimated life-span of 4-5 years. The total value of these banknotes in circulation has declined from ₹6.73 lakh crore at its peak as on March 31, 2018 (37.3% of Notes in Circulation) to ₹3.62 lakh crore constituting only 10.8% of Notes in Circulation on March 31, 2023. It has also been observed that this denomination is not commonly used for transactions,” the statement further said.
In order to avoid disruption of services and ensure smooth operations the central bank has instructed public to exchange or deposit their notes into banks. Currently, people can continue to use Rs 2,000 banknotes for their transactions and also receive them in payment. However, they are encouraged to deposit and/or exchange these banknotes before the final dates. The facility for exchange will also be available at the 19 Regional Offices (ROs) of RBI having Issue Department.
Exchange of ₹2000 banknotes into banknotes of other denominations can be made upto a limit of ₹20,000 at a time at any bank starting from May 23, 2023. All banks shall provide deposit and/or exchange facility for ₹2000 banknotes until September 30, 2023.
It is worth noting that RBI had undertaken a similar withdrawal of notes from circulation in 2013-2014.