The Reserve Bank of India (RBI) has issued a directive to banks, instructing them to cease the issuance of Rs 2000 denomination banknotes with immediate effect. However, existing Rs 2000 banknotes will continue to be recognized as legal tender. The introduction of Rs 2000 banknotes in November 2016 was primarily aimed at swiftly fulfilling the currency requirements after the withdrawal of Rs 500 and Rs 1000 banknotes. Consequently, the printing of Rs 2000 banknotes was discontinued in 2018-19.
As part of the RBI’s “Clean Note Policy,” a decision has been made to withdraw the circulation of Rs 2000 banknotes, while emphasizing that they will retain their legal tender status. A significant proportion (around 89%) of the Rs 2000 banknotes were issued before March 2017 and are approaching the estimated lifespan of 4-5 years. The total value of these banknotes in circulation has noticeably declined, and it has been observed that the Rs 2000 denomination is not widely utilized for transactions.
To ensure a seamless transition, individuals can either deposit their Rs 2000 banknotes into their respective bank accounts or exchange them for banknotes of other denominations at any bank branch. Deposits can be made without restrictions, adhering to existing guidelines and relevant statutory provisions. Moreover, banks will facilitate the exchange of Rs 2000 banknotes for other denominations, up to a limit of Rs 20,000 per transaction, starting from May 23, 2023.
In order to complete the withdrawal process efficiently and provide sufficient time for the public, banks will continue to offer deposit and/or exchange facilities for Rs 2000 banknotes until September 30, 2023. The RBI has issued separate guidelines to banks, ensuring a smooth transition and effective implementation of the withdrawal.
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