Financial Services News

First day of ₹2,000 note exchange: small queues seen at some branches

A man exchange 2000 notes at a bank in Vijayawada on May 23, 2023.
| Photo Credit: G.N. Rao

Small queues were witnessed at some bank branches on Tuesday (May 23) for the exchange of ₹2,000 notes against smaller denominations as part of the withdrawal exercise.

As per the RBI guidelines issued on Friday (May 19), the exchange of ₹2,000 facility is available from Tuesday (May 23).

A person can exchange up to a limit of ₹20,000 at a time without filling any form or requisition slip.

Further, no identity proof is required to be submitted by the tenderer at the time of exchange.

No great rush was witnessed for exchange when branches opened. Outlets of private sector banks in metro cities in the early hours had business as usual.

According to a senior official of a public sector bank, not much rush is seen so far because there is a window of four months for exchange and currency in circulation to be exchanged is also relatively less compared to demonetisation.

It is to be noted that 86% of India’s currency in circulation was made invalid on November 8, 2016.

However, this time, ₹2,000 notes remain a legal tender.

The official said, as far as the deposit in accounts are concerned, it is happening as usual and there is not much rush so far. Deposits are being accepted as per the extant guidelines.

RBI on Friday, in a surprise move, announced withdrawal of ₹2,000 currency notes from circulation but gave the public time till September 30, to either deposit such notes in accounts or exchange them at banks.

Unlike the November 2016 shock demonetisation, when old ₹500 and ₹1,000 notes were invalidated overnight, the ₹2,000 notes will continue to be a legal tender.

RBI Governor Shaktiikanta Das on Monday said there is enough time available for exchange and deposit in bank accounts, so people should not panic.

There is more than adequate quantity of printed notes available in the system not just with the RBI, but also at the currency chests which are operated by the banks, he said.

“So there is adequate stock available and there is no reason to worry whatsoever. We have more than sufficient stock,” he said.

The RBI Governor also said that the RBI is sensitive to the difficulties which may be faced by people who are on long foreign visits or living abroad on work visas.

“It will be our endeavour to address the difficulties of the people and to complete the entire process in a smooth manner,” he said.

To a question regarding black money coming back to the system, he said, there is a set procedure for deposits in your account or cash exchange.

“What we have said is that the existing requirements or the existing procedures have to be followed by the banks. We have not come out with an additional procedure. You must be aware that there’s an Income Tax rule if you deposit cash above ₹50,000 then you have to produce your PAN. So existing rules will apply,” he said.

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