97.38% of ₹2,000 currency notes back in banks, says RBI

Indians have returned 97.38% of ₹2,000 banknotes in circulation as of 19 May when the regulator announced the withdrawal, the Reserve Bank of India (RBI) said on Monday. The total value of ₹2,000 banknotes remaining in circulation as of the close of business on December 29, 2023, stood at ₹9,330 crore, the apex bank said.

The central bank said ₹2,000 banknotes will continue to be legal tender.

According to the banking regulator, 97.38% of the ₹2,000 banknotes that were circulated in the economy till May 19, 2023, have been returned. At the time of the announcement of the withdrawal of the banknotes, the total value of ₹2,000 banknotes in circulation was ₹3.56 lakh crore.

The total value of ₹2,000 banknotes remaining in circulation as of the close of business on December 29, 2023, stood at ₹9,330 crore, the RBI added.

Initially, banks provided the opportunity to deposit and/or exchange ₹2000 banknotes up to September 30, 2023. However, it was extended to October 7, 2023.

The RBI said the facility for the exchange of the ₹2000 banknotes is still available at the 19 Issue Offices of the Reserve Bank (RBI Issue Offices) 1 since May 19, 2023. From October 09, 2023, RBI Issue Offices are also accepting ₹2000 banknotes from individuals or entities for deposit into their bank accounts.

The banking regulator further said the public from within the country can send ₹2000 banknotes through India Post from any post office in the country to any of the RBI Issue Offices for credit to their bank accounts.

In May this year, RBI said it had decided to withdraw ₹2,000 currency notes from circulation and advised banks not to issue ₹2,000 notes with immediate effect. As a part of the “Clean Note Policy” on May 19, 2023, the RBI decided to withdraw the ₹2,000 denomination banknotes from circulation.

The ₹2000 denomination banknote was introduced in November 2016, primarily to meet the currency requirement of the economy in an expeditious manner after the withdrawal of the legal tender status of all ₹500 and ₹1,000 banknotes in circulation at that time.

Livemint earlier reported that about 89% of the ₹2,000 denomination banknotes were issued before 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 ₹6.73 lakh crore at its peak as on March 31, 2018 (37.3% of Notes in Circulation) to ₹3.62 lakh crore constituting only 10.8% of Notes in Circulation on March 31, 2023.

The apex bank also said it has 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.