Think of money and, in all probability, you will encounter images of notes and coins. Try finding out about these and you will find interesting stories, some of them useful, too.
The disappearing act
When was the last time you saw a 2-paisa coin? Perhaps, in your grandmother’s collection of old coins. The 1990s generation may not even know it existed. The latest to make the disappearing act is the 25-paisa coin. Even today, the neighbourhood grocer and bus conductor may refuse to accept your 25-paisa coins; come July and even banks will stop accepting it. So if your change basket at home has 25-paisa coins, ferret them out and get them exchanged for their face value at designated bank branches before 30 June.
Does money retire?
Yes. Soiled, mutilated and imperfect notes can be exchanged at any bank. In fact, banks are expected to extend the facility of exchange of soiled notes even if you are not a customer. While soiled notes can be exchanged for full value, mutilated and imperfect notes may not be exchanged for full value, depending on their condition.
You wouldn’t have used or seen coins whose value is higher than Rs10 or notes of a denomination higher than Rs1,000. However, the current legislative provisions permit issuing of coins up to the denomination of Rs1,000 and notes up to the denomination of Rs10,000. So some decades later, you may start using a Rs10,000 note.
In and out
While you may haven’t, your grandparents may have seen Rs10,000 notes. Bank notes in denominations of Rs1,000 and Rs10,000 were in circulation in pre-independence India. These were demonetized in January 1946 to control unaccounted money. Notes in the denomination of Rs1,000, Rs5,000 and Rs10,000 notes were reintroduced in 1954 and again demonetized in January 1978. The Rs1,000 notes that we use today were reintroduced in 2000. Likewise, the Rs5 note was also printed again in 2001 to make up for the shortfall in supply of Rs5 coins. The printing of Rs5 notes was stopped again from the year 2005 but they are still in circulation.
In order to increase the shelf life of currency notes, the Reserve Bank of India (RBI) has forbidden banks from stapling or stamping notes. You can help the endeavour by keeping notes clean yourself.
RBI has the sole authority to issue bank notes in India. However, Rs1 notes were issued by the Government of India; they are not printed any more. The government has the sole right to mint coins, but the coins are issued for circulation only through RBI.
The government imported notes in 1997-98 as a one-time measure to bridge the demand-supply gap. It also imported Rs1 coins during 2000-2003 to supplement the supply of coins minted in the country.