Rs.2000 Denomination Banknotes
Withdrawal from Circulation; Will continue as Legal Tender
The Rs.2000 denomination banknote was introduced in November 2016 under Section 24(1) of RBI Act, 1934, primarily to meet the currency requirement of the economy in an expeditious manner after the withdrawal of legal tender status of all Rs. 500 and Rs. 1000 banknotes in circulation at that time. The objective of introducing Rs.2000 banknotes was met once banknotes in other denominations became available in adequate quantities. Therefore, printing of Rs.2000 banknotes was stopped in 2018-19.
2. About 89% of the Rs.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 26.73 lakh crore at its peak as on March 31, 2018 (37.3% of Notes in Circulation) to 23.62 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. Further, the stock of banknotes in other denominations continues to be adequate to meet the currency requirement of the public.
3. 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 Rs.2000 denomination banknotes from circulation.
4. The banknotes in Rs.2000 denomination will continue to be legal tender.
5. It may be noted that RBI had undertaken a similar withdrawal of notes from circulation in 2013-2014.
6. Accordingly, members of the public may deposit Rs.2000 banknotes into their bank accounts and/or exchange them into banknotes of other denominations at any bank branch. Deposit into bank accounts can be made in the usual manner, that is, without restrictions and subject to extant instructions and other applicable statutory provisions.
7. In order to ensure operational convenience and to avoid disruption of regular activities of bank branches, exchange of Rs.2000 banknotes into banknotes of other denominations can be made upto a limit of Rs.20,000/- at a time at any bank starting from May 23, 2023.
8. To complete the exercise in a time-bound manner and to provide adequate time to the members of public, all banks shall provide deposit and/or exchange facility for Rs.2000 banknotes until September 30, 2023. Separate guidelines have been issued to the banks.
9. The facility for exchange of Rs.2000 banknotes upto the limit of Rs.20,000/- at a time shall also be provided at the 19 Regional Offices (ROs) of RBI having Issue Departments' from May 23, 2023.
10. The Reserve Bank of India has advised banks to stop issuing Rs.2000 denomination banknotes with immediate effect.
11. Members of the public are encouraged to utilise the time up to September 30, 2023 to deposit and/or exchange the Rs.2000 banknotes. A document on Frequently Asked Questions (FAQs) in the matter has been hosted on the RBI website for information and convenience of the public.
(Yogesh Dayal)
Chief General Manager
Also Read: RBI Withdraws Rs 2,000 Banknotes - FAQs and Guidelines
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