In a recent disclosure by the Reserve Bank of India (RBI), a staggering 93% of the highest denomination currency notes, the ₹2,000 notes, amounting to ₹3.32 trillion (approximately $40.14 billion), have been successfully repatriated following the RBI’s decision to phase out these banknotes from circulation.
The RBI’s announcement in May articulated its intent to withdraw these high-value notes while allowing for their exchange or deposit until September 30.
As of May 19, the aggregate value of ₹2,000 notes in circulation had diminished to ₹3.56 trillion, a decline from the ₹3.62 trillion reported at the end of the preceding fiscal year on March 31. Remarkably, the latest data as of August 31 indicates that ₹240 billion worth of these ₹2,000 notes remain in circulation.
Further analysis conducted on data sourced from leading banks reveals that a substantial 87% of the banknotes received by these financial institutions took the form of deposits, while the remaining 13% underwent exchange for other denominations, as stated by the RBI.
Introduced in 2016, the ₹2,000 denomination notes were aimed at replenishing the currency in circulation within the Indian economy, following the government’s extraordinary measure to demonetize high-value banknotes overnight. Nevertheless, the central bank has consistently expressed its commitment to reducing the prevalence of high-value notes in circulation, with a cessation of printing ₹2,000 notes observed over the past four years.
The RBI’s recent data sheds light on the resounding success of its initiative to phase out the ₹2,000 notes, underlining a significant shift in the nation’s monetary landscape.