The Reserve Bank of India (RBI) has reported that 97.82% of the Rs. 2000 denomination banknotes in circulation as of May 19, 2023, have been returned.
This follows the RBI’s announcement, detailed in a Press Release from May 19, 2023, about the withdrawal of these high-value notes from circulation.
The RBI initiated the withdrawal of Rs. 2000 banknotes to streamline the currency system and manage liquidity more effectively. From May 19, 2023, the public was given the facility to deposit or exchange these notes at all bank branches across the country.
This facility was available until October 07, 2023, allowing time for individuals and businesses to adapt to the change.
Post October 07, 2023, the exchange facility for Rs 2000 notes was centralized to the 19 RBI Issue Offices. Starting from October 09, 2023, these offices also began accepting the Rs. 2000 banknotes for direct deposit into bank accounts.
Additionally, the RBI partnered with India Post, enabling citizens to send their Rs. 2000 notes from any post office within the country to any RBI Issue Office for credit to their bank accounts.
Status Quo of Rs 2000 notes at the time of withdrawal announcement
When the withdrawal was announced, Rs. 2000 banknotes worth Rs. 3.56 lakh crore were in circulation. By the close of business on May 31, 2024, this figure had went to Rs. 7755 crore.
When and Why were Rs. 2000 notes introduced?
The Rs 2000 denomination banknote was introduced in November 2016 under Section 24(1) of the RBI Act, 1934, primarily to address the urgent currency requirements of the Indian economy following the demonetisation of Rs 500 and Rs 1000 banknotes.
This move was intended to quickly replenish the currency supply and mitigate the cash shortage that ensued from the withdrawal of these higher denomination notes.
The introduction of the Rs 2000 note served its purpose until other denominations became available in sufficient quantities, after which the printing of Rs 2000 banknotes ceased in 2018-19.
