RBI Extends Deadline to Exchange Rs 2,000 Banknotes Till Oct 7; What Happens After This Date? – News18

The Reserve Bank of India (RBI) on Saturday, September 30, extended the deadline to deposit or exchange Rs 2,000 currency notes by a week until October 7, 2023. After this deadline, the high-value currency can only be exchanged at the RBI’s 19 issue offices, and this facility will be stopped at nearby banks.

“As the period specified for the withdrawal process (September 30, 2023) has come to an end, and based on a review, it has been decided to extend the current arrangement for deposit/ exchange of Rs 2000 banknotes until October 07, 2023,” the RBI said in a statement on Saturday.

The RBI had on May 19 this year decided to withdraw Rs 2,000 banknotes from circulation, and fixed September 30 as the last date to deposit or exchange the notes.

“Rs 2,000 banknotes shall continue to be legal tender,” the central bank said on Saturday while extending the deadline to deposit and exchange the high-value currency notes until October 7, 2023.

Currency holders can deposit or exchange the Rs 2,000 banknotes till October 7 at their nearby banks up to the limit of Rs 20,000 at a time. However, the deposits can be made in the bank account without any amount limit.

The exchange and deposit facility is also available at the RBI’s 19 issue offices.

“Individuals/ entities from within the country can also send Rs 2,000 banknotes through India Post, addressed to any of the 19 RBI issue offices for credit to their bank accounts in India,” the RBI said in a statement.

So far, 96 per cent of the Rs 2000 banknotes in circulation as on May 19, 2023, have since been returned, the RBI said.

According to the RBI’s latest statement, after the deadline of October 7, the procedure for deposit/ exchange of Rs 2000 banknotes shall be as under:

a) The deposit/ exchange at bank branches shall be stopped.

b) Rs 2000 banknotes can continue to be exchanged by individuals/ entities at the 19 RBI Issue Offices up to a limit of Rs 20,000 at a time.

c) Individuals/ entities can tender Rs 2000 banknotes at the 19 RBI issue offices for credit to their bank accounts in India for any amount.

d) Individuals/ entities from within the country can also send Rs 2,000 banknotes through India Post, addressed to any of the 19 RBI issue offices for credit to their bank accounts in India.

e) Such exchange or credit shall be subject to relevant RBI/ government regulations, submission of valid identity documents and due diligence as deemed fit by the RBI.

f) Courts, law enforcement agencies, government departments or any other public authority involved in investigation proceedings or enforcement, may, as and when required, deposit/ exchange Rs 2000 banknotes at any of the 19 RBI Issue offices without any limit.

“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 Rs 0.14 lakh crore in circulation as at the close of business on September 29, 2023. Thus, 96 per cent of the Rs 2000 banknotes in circulation as on May 19, 2023 has since been returned,” the RBI said.

The facility for deposit/ exchange of Rs 2000 banknotes at the 19 RBI Issue Offices shall be available till further advice, the central bank said.

Why Is RBI Withdrawing Rs 2,000 Notes?

The RBI decided to withdraw the Rs 2,000 denomination banknotes from circulation in pursuance of its ‘Clean Note Policy’.

Announcing the withdrawal of the high-value currency notes on May 19, 2023, the RBI said “it has also been observed that this denomination (Rs 2,000 banknotes) is not commonly used for transactions. Further, the stock of banknotes in other denominations continues to be adequate to meet the currency requirement of the public.”

Following the withdrawal decision, RBI Governor Shaktikanta Das addressing reporters on May 22 said the Rs 2,000 banknotes were introduced primarily to replenish the notes withdrawn following demonetisation in 2016.

“Rs 2,000 notes have completed their cycle and age, and their withdrawal is part of the currency management operation,” he added.