Indians turned in nearly all the currency notes banned in 2016: RBI

Indians turned in nearly all the currency notes banned in 2016: RBI

Prime Minister Narendra Modi's decision to ban high-value currency notes of Rs 500 and Rs 1000, along with the introduction of the goods and services tax (GST) past year, acted as a drag on the Indian economy.

Almost all the demonetized notes came back to Reserve Bank of India according to RBI's annual report for 2017-18.

RBI's annual report says: "In consultation with the Government of India, the Reserve Bank has been exploring the feasibility of increasing the life of Indian banknotes".

This meant just Rs 10,720 crore of the junked currency did not return to the banking system.

The share of newly introduced Rs 200 banknotes in the total value of banknotes in circulation was 2.1 per cent as at end-March 2018. For example, 15% of total notes in circulation are ₹500s and they account for 42% of the total value of currency in circulation.

"The total value of SBNs (specified banknotes) returned from circulation is Rs 15,310.73 billion", the report said.

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The SBNs received were verified, counted and processed in the sophisticated high speed currency verification and processing system (CVPS) for accuracy and genuineness and then shredded, it added.

The currency recall exercise in November 2016 has had positive impact and government has achieved its objective "quite substantially", even as an RBI report outlined that 99.3 percent of junked notes came back to banks.

"The notes issued increased by 26.93 per cent from Rs 15,063.31 billion as on June 30, 2017 to Rs 19,119.60 billion as on June 30, 2018", the report said.

According to the report, out of the Rs.15.41 lakh crore of Rs. 500 and Rs. 1,000 notes in circulation post demonetisation, nearly Rs.15.31 lakh crore notes worth have been returned.

Similarly, 9,892 pieces of counterfeit notes were detected in the new Rs 500 banknotes in 2017-18 - a 4178 per cent jump from 199 in the previous fiscal. The rise in cost of printing was due to printing of new currency notes during remonetisation.

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