The Reserve Bank of India (RBI) has announced its decision to withdraw the ₹2000 denomination banknotes from circulation, while still maintaining their legal tender status.
Effective immediately, banks have been instructed to cease issuing ₹2000 notes.
RBI withdraws ₹2000 note from circulation
Introduced in November 2016 to address the currency requirement after the withdrawal of ₹500 and ₹1000 notes, the ₹2000 notes will continue to be accepted as legal tender beyond September 30, 2023.
The RBI expects that the majority of circulating ₹2000 notes will be returned to banks within the given four-month timeframe, and this move is considered a routine exercise that shouldn’t cause public alarm.
According to the RBI’s statement, the objective of introducing ₹2000 notes has been achieved, as banknotes of other denominations are now readily available.
Also Read – RBI Approved Loan Apps In India
Total Circulation Of ₹2000 Note
Printing of ₹2000 notes was halted in the financial year 2018-19.
It is noteworthy that approximately 89% of the ₹2000 notes were issued prior to March 2017 and have now reached their estimated lifespan of 4-5 years.
The value of these notes in circulation has significantly declined from its peak of ₹6.73 lakh crore in March 2018, constituting only 10.8% of total notes in circulation as of March 31, 2023.
Additionally, it has been observed that the ₹2000 denomination is not commonly used for transactions.
The RBI assures the public that the stock of banknotes in other denominations is adequate to meet the currency requirement.
Individuals can deposit ₹2000 notes into their bank accounts or exchange them for other denominations at any bank branch.
Deposits can be made without restrictions, following the usual procedures and applicable regulations.
Beginning May 23, 2023, individuals can also exchange ₹2000 notes for other denominations up to a limit of ₹20,000 at a time, ensuring operational convenience and avoiding disruptions at bank branches.
Why RBI withdraws ₹2000 note?
This withdrawal of ₹2000 notes aligns with the RBI’s “Clean Note Policy” and follows a similar exercise carried out in 2013-2014.
Read – RBI on Digital Wallet Money
