RBI extends deadline to return Rs 2,000 banknotes till Oct 7

The Reserve Bank of India (RBI) on Saturday extended deadline for exchanging Rs 2,000 notes till October 7, 2023.

"According to the data received from banks, of the total value of Rs 3.56 lakh crore of Rs 2000 banknotes in circulation as on May 19, 2023, Rs 3.42 lakh crore has been received back leaving only ₹0.14 lakh crore in circulation as at the close of business on September 29, 2023," the central bank said in a release.

About 96 per cent of the Rs 2,000 banknotes have been returned to the banking system since the Reserve Bank of India (RBI) in May decided to withdraw the high-value note from circulation, as per central bank's latest update.

RBI has said that effective from October 8, all branches will cease the procedure for exchange or deposit of the said currency. However, the notes will continue to be of legal tender and citizens can exchange at the 19 RBI Issue Offices up to a limit of Rs 20,000 at a time. Further the deposit amount can be unlimited at these offices.

Moreover, individuals can from within the country can also send the Rs 2000 banknotes through India Post, addressed to any of the 19 RBI Issue Offices for credit to their bank accounts in India.

"Such exchange or credit shall be subject to relevant RBI / Government regulations, submission of valid identity documents and due diligence as deemed fit by RBI," the apex bank informed in a press release.

The total value of Rs 2000 banknotes in circulation was Rs 3.56 lakh crore at the close of business on May 19, 2023 - when the RBI decided to withdraw the banknote.

“Data collected from major banks indicates that out of the total banknotes in Rs 2000 denomination received back from circulation, about 87 per cent is in the form of deposits and the remaining around 13 per cent has been exchanged into other denomination banknotes,” RBI said.

September 30 was been decided as the last date for the purpose of completing the exercise in a time-bound manner and to provide adequate time to the public. RBI may or may not revisit the September deadline based on the situation going ahead.

The Rs 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 Rs 500 and Rs 1000 banknotes in circulation at that time.

The objective of introducing Rs 2000 banknotes was met once banknotes in other denominations became available in adequate quantities. Therefore, the printing of Rs 2000 banknotes was stopped in 2018-19.