RBI Expects Return Of Most Rs 2,000 Banknotes In Circulation By September 30: Governor Shaktikanta Das

Das said Rs 2,000 currency notes continue to be legal tender, while adding Rs 2,000 rupee notes were introduced primarily to replenish the currency that was withdrawn following 2016 demonetisation

The Reserve Bank of India (RBI) Governor Shaktikanta Das on Monday said most of the withdrawn Rs 2,000 rupee notes are expected to be returned by the deadline of September 30. Speaking to reporters for the first time since the surprise decision to withdraw the highest denomination currency note was announced, Shaktikanta Das said the decision was part of the bank's currency management.

While the withdrawn 2,000 rupee notes can either be deposited in bank accounts or exchange for other currency, banks have been advised to make necessary arrangements for exchange, he said. "We expect most of Rs 2,000 bank notes to come back to the exchequer by September 30," he said. "We have more than adequate quantities of printed notes already available in the system, not just with RBI but with currency chests operated by banks. There is no reason for worry. We have sufficient stocks, no need to worry."

While assuirng the public, Das said, the RBI was sensitive to difficulties faced by people and would come out with regulations if need be.

The Indian currency management system is very robust, exchange rate has remained stable despite crisis in financial markets due to war in Ukraine and failure of certain banks in the West, he said. The impact of the withdrawal on the economy will be "very very marginal", he said, adding Rs 2,000 currency notes made up for just 10.8 per cent of the total currency in circulation.

Das said Rs 2,000 currency notes continue to be legal tender, while adding Rs 2,000 rupee notes were introduced primarily to replenish the currency that was withdrawn following 2016 demonetisation.

Existing income tax requirement of furnishing PAN for deposits of Rs 50,000 or more in bank accounts will continue to apply for deposits of the withdrawn 2000 rupee notes, he said. Das said liquidity in the system is being monitored on a daily basis. 

The RBI on Friday through a notification advised all banks to stop issuing Rs 2000 denomination banknotes with immediate effect. However, the banknotes in Rs 2000 denomination will continue to be legal tender.