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The Reserve Bank of India (RBI) has made the decision to remove the ₹2000 denomination notes from circulation while ensuring that they remain valid as legal tender. The RBI’s announcement states that this action is in line with the “Clean Note Policy” and aims to withdraw the ₹2000 denomination banknotes from circulation, while still allowing them to be used as legal tender.
The RBI has recommended that individuals either deposit their ₹2000 banknotes into their bank accounts or exchange them for banknotes of different denominations at any bank branch. According to an official statement by the RBI, depositing the ₹2000 banknotes into bank accounts can be done without any restrictions, following the usual procedures and adhering to existing guidelines and applicable laws.
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To maintain smooth operations and prevent any disruption to regular banking activities, the RBI has also stated that the exchange of ₹2000 banknotes for banknotes of different denominations can be conducted at any bank branch. This exchange can be made up to a limit of ₹20,000 at a time, starting from May 23, 2023.
Additionally, in order to ensure a seamless process for the exchange or deposit of ₹2000 banknotes, the RBI has granted all banks sufficient time until September 30, 2023. The central bank has also advised banks to discontinue the issuance of ₹2000 denomination banknotes with immediate effect.
Furthermore, the Reserve Bank of India (RBI) has shared data indicating that the overall value of ₹2000 notes in circulation has decreased to 10.8 percent of the total as of March 31, 2023.
On May 19, the RBI stated that approximately 89 percent of the ₹2000 denomination banknotes were issued prior to March 2017 and have now reached the end of their estimated lifespan of 4-5 years. The central bank further reported that the total value of these banknotes in circulation has declined significantly. It went from ₹6.73 lakh crore, accounting for 37.3 percent of the total notes in circulation, at its peak on March 31, 2018, to ₹3.62 lakh crore, representing only 10.8 percent of the total notes in circulation on March 31, 2023.
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According to the central bank, the ₹2000 denomination banknotes are not widely utilized for day-to-day transactions. The RBI also mentioned that there is an ample supply of banknotes in other denominations to fulfill the currency needs of the public.
In November 2016, the RBI introduced ₹2000 banknotes as a swift measure to address the currency requirements of the economy following the demonetization of all ₹500 and ₹1000 banknotes in circulation at that time.
