RBI: 96% of ₹2,000 banknotes returned, exchange deadline extended to October 7

The Reserve Bank of India has extended the period for deposit/exchange of ₹2,000 banknotes until October 7, 2023, even as ₹14,000 crore worth of these notes still remain in circulation. It emphasised that these notes will continue to be legal tender.

The exercise to deposit and/or exchange ₹2,000 banknotes at bank branches was done on September 30, 2023.

The central bank said 96 per cent of ₹2,000 banknotes in circulation as of May 19, 2023, have since been returned, leaving only 4 per cent in circulation as of the close of business on September 29, 2023.

• Read: RBI paid over ₹1,300 crore to procure over 370 crore pieces of ₹2,000 notes’

RBI said that from October 08, 2023, the deposit/exchange of ₹2,000 banknotes at bank branches shall be stopped. However, these notes can continue to be exchanged by individuals/entities at the 19 RBI Issue Offices up to a limit of ₹20,000 at a time.

Individuals/Entities can tender ₹2,000 banknotes at the 19 RBI Issue Offices for credit to their bank accounts in India for any amount.

Individuals/Entities from within the country can also send ₹2,000 banknotes through India Post, addressed to any of the 19 RBI Issue Offices for credit to their bank accounts in India.

Such exchange or credit will be subject to relevant RBI/Government regulations, submission of valid identity documents and due diligence deemed fit by RBI.

Courts, law enforcement agencies, government departments, or any other public authority involved in investigation proceedings or enforcement may, as and when required, deposit/exchange ₹2,000 banknotes at any of the 19 RBI Issue Offices without any limit, RBI said.

According to received by RBI from banks, of the total value of ₹3.56 lakh crore of ₹2,000 banknotes in circulation as of May 19, 2023, ₹3.42 lakh crore has been received back.

The RBI initiated the exercise for the withdrawal of ₹2000 banknotes on May 19 to introduce them (to meet the currency requirement of the economy after the withdrawal of the legal tender status of all ₹500 and ₹1,000 banknotes in circulation in the November-December 2016 period) was met once banknotes in other denominations became available in adequate quantities.

“About 89 per cent of the ₹2,000 denomination banknotes were issued prior to March 2017 and are at the end of their estimated life-span of 4-5 years...It has also been observed that this denomination is not commonly used for transactions. Further, the stock of banknotes in other denominations continues to be adequate to meet the currency requirement of the public.

“In view of the above, and in pursuance of the “Clean Note Policy” of the Reserve Bank of India, it has been decided to withdraw the ₹2,000 denomination banknotes from circulation,” the central bank said in a statement on May 19, 2023.