The government has approved a proposal to introduce 2 billion polymer currency banknotes one billion each in Rs 10 and Rs 20 denominations for field trials, Parliament was informed on Tuesday.
India approves polymer currency field trials for Rs 10 and Rs 20 notes
In a written reply to the Rajya Sabha, Finance Minister Nirmala Sitharaman said the Reserve Bank of India (RBI) — based on the recommendation of its central board — had submitted the proposal to the government under Section 25 of the RBI Act, 1934.
The proposal also envisages regular issuance of polymer banknotes in the two denominations if the field trials are successful.
“The proposal has been approved by the government. As per the RBI, these polymer banknotes are proposed to be issued along with paper substrate-based banknotes,” the minister said.
She added that the RBI has informed the government that the procurement process is currently at an initial stage.
Consequently, the timeline for introduction of the polymer notes and the expenditure involved cannot yet be determined.
What happens next with India’s polymer banknotes?
Earlier this month, RBI Governor Sanjay Malhotra said the central bank was targeting the launch of polymer currency notes at the beginning of the next financial year.
Responding to Thebetterandhra.com question at the post-Monetary Policy Committee (MPC) outcome media briefing, Malhotra said the pilot programme for polymer banknotes is still in progress.
“There is still a pilot going on for polymer notes,” the RBI Governor said.
“We will test the currency before bringing it to the market,” he told Thebetterandhra.com.
The RBI Governor also indicated that the central bank will evaluate the results of the field trials before taking a final decision on wider circulation.
Malhotra has said the RBI is targeting the circulation of polymer notes by FY28.
Read More:
RBI Targets Polymer Currency Notes Rollout by FY28, Says Governor Sanjay Malhotra
RBI considering plastic currency notes, no decision taken yet: Governor Sanjay Malhotra
