RBI reports that 88 percent of the Rs 2,000 notes, worth Rs 3.14 billion, were returned to banks

The Reserve Bank of India (RBI) said on Tuesday that just Rs 42,000 crore worth of the Rs 2,000 currency notes were still in circulation as of July 31. Up to 88% of these notes have either been deposited or exchanged at banks.

The deadline for exchanging or depositing notes worth Rs 2,000 is September 30.

In value terms, the amount of Rs 2,000 notes in circulation decreased to Rs 42,000 crore in July from Rs 3.56 lakh crore on May 19, the day the withdrawal was announced.

 

The RBI said in a statement that of the entire amount of Rs 2,000 banknotes it had recovered from circulation, around 87 percent were in the form of deposits and the remaining roughly 13 percent had been swapped for notes of other denominations.

 

Surprisingly, the central bank declared on May 19 that it will stop printing Rs 2,000 notes, but it granted the people till September 30 to deposit the notes in accounts or exchange them at banks.

 

The old Rs. 500 and Rs. 1,000 notes were instantly rendered useless after the November 2016 demonetisation, while the old Rs. 2,000 notes would remain valid until September 30.

 

As of the end of business on May 19, 2023, the total value of the Rs 2,000 banknotes in circulation, which was Rs 3.62 lakh crore on March 31, 2023, has decreased to Rs 3.56 lakh crore.

 

The entire amount of Rs 2,000 banknotes that will be returned from circulation up to July 31, 2023, based on information from the banks, is Rs 3.14 lakh crore, according to the RBI.

 

“As a result, the total value of Rs 2,000 banknotes in circulation as of July 31’s business closing was Rs 0.42 lakh crore. Therefore, 88% of the Rs 2,000 banknotes in use as of May 19, 2023, have been returned since then, it added.

 

In order to prevent a rush in the last days before September 30, 2023, the RBI further urged the general people to use the next two months to deposit and/or exchange the Rs 2,000 banknotes stored with them.

 

It should be noted that the RBI has not yet specified how Rs 2,000 notes held by private individuals would be treated after September 30.

 

The government declared it unlawful to keep the withdrawn Rs. 500 and Rs. 1,000 notes (beyond a predetermined limit) after the deposit deadlines had passed in 2016 after declaring demonetisation.