The Reserve Bank of India Ceases Exchange and Deposit of INR 2,000 Notes in Banks
RBI’s Decision and Return Rate
The Reserve Bank of India (RBI) has announced that starting from October 7, 2023, banks will no longer accept or exchange INR 2,000 notes. This decision comes after the RBI’s previous statement on September 30, revealing that out of the total INR 3.56 lakh crore ($48 billion) worth of INR 2,000 banknotes in circulation since May 19, INR 3.42 lakh crore ($46 billion) had been returned by September 29.
Availability of Valid Currency
With a return rate of 96%, there is INR 0.14 lakh crore ($1.9 billion) worth of INR 2,000 notes that are still considered valid currency. Although banks will no longer accept deposits or exchanges, these notes can still be exchanged or deposited at any of the RBI’s 19 Issue Offices located in major Indian cities such as Mumbai, Delhi, Chennai, and Kolkata.
Due Diligence Procedures
Individuals wishing to exchange or deposit their INR 2,000 notes at the RBI’s regional offices will need to follow due diligence procedures. This includes providing identification documents such as PAN, Aadhaar, or Driver’s License for KYC compliance, as well as bank account details for the credit process.
Exchange Facility and Deadline
While the exchange facility has been discontinued in banks, the RBI has not set a deadline for exchanges or deposits at its regional offices. The central bank has stated that this provision will be available “till further advice”. Additionally, the notes can also be sent via India Post, making it more accessible for individuals living outside major cities.
Managing High-Value Banknotes
The RBI’s decision to cease the exchange and deposit of INR 2,000 notes in banks is part of an effort to better manage the circulation of high-value banknotes in India. Holders of these notes are encouraged to take advantage of the exchange facility at RBI regional offices or through India Post until further notice.
This article was generated with the support of AI and reviewed by an editor.
