After ₹2000 demonetisation, is ₹500 note next? Will ₹1,000 banknotes return in circulation? Govt replies
The Reserve Bank of India removed ₹2,000 notes from circulation, with the last date to submit them in banks being September. The Finance Ministry denies demonetizing ₹500 notes and reintroducing ₹1,000 notes, stating there is enough buffer stock of other denominations
PremiumThe Reserve Bank of India announced the removal of ₹2,000 currency notes from circulation in mid-May this year. The last date to submit ₹2000 currency notes in bank is September.
In the ongoing monsoon session, the Finance Ministry was asked about the demonetisation of ₹500 notes and the reintroduction of ₹1,000 notes in the economy.
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To the question, Minister of State for Finance, Pankaj Chaudhary denied the demonetisation of the highest denomination of currency notes existent in the economy (i.e. ₹500 notes).
In a written reply to the question of the reintroduction of ₹1,000 currency notes, the MoS Finance said , “ According to RBI, the withdrawal was a currency management operation planned to avoid any inconvenience to public or any disruption in the economy. Further, withdrawal of ₹2000 banknotes has been factored in, in the current year’s requirement and sufficient buffer stock of banknotes in other denominations is being maintained across the country to meet exchange / withdrawal requirements."
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The answer states that after the withdrawal of the ₹2,000 currency notes, there is enough buffer stock of banknotes in other denominations maintained across country. With this information, the government has made it clear that it is not planning to reintroduce ₹1,000 notes again in the economy.
₹2000 currency note circulation to end in September
The Finance Ministry also made it clear that there will be no extension of the last date of exchange ₹2000 bank notes, which is September 30.
In another reply, Pankaj Chaudhary said that the value of ₹2,000 denomination banknotes in circulation at the end of June was 0.84 lakh crore. Whereas, the percentage of such banknotes in overall rupee in circulation was 2.51 per cent.
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The total value of ₹2,000 banknotes in circulation stood at ₹3.56 lakh crore at the close of business on May 19, 2023. The time when the RBI had announced the withdrawal of note. For those, who are yet to exchange their ₹2000 currency notes, they can exchange them at any bank branch till September 30. MoS finance has also made it clear that the deadline for the extension of exchange of ₹2000 currency notes will not be extended beyond September.
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