“Purpose of Rs 2000 was fulfilled,” said the Governor, further adding that the entire process of withdrawal of Rs 2,000 notes would be non-disruptive.
During a Confederation of Indian Industry (CII) event, Reserve Bank of India (RBI) Governor Shaktikanta Das provided insights into the withdrawal of the Rs 2,000 banknotes. He stated that the decision to withdraw the high-denomination banknotes was made after informal surveys indicated a lack of common usage. The RBI had previously communicated that the circulation of Rs 2,000 banknotes had declined, and the stock of other denominations was sufficient to meet the public’s currency requirements. Governor Das emphasized that the purpose of the Rs 2,000 notes had been fulfilled and assured a non-disruptive withdrawal process.
Withdrawal Decision Based on Usage Patterns:
Governor Das addressed industry executives during the CII’s annual session, explaining the rationale behind withdrawing the Rs 2,000 banknotes. He stated that the decision was prompted by informal surveys that indicated the note’s limited usage in transactions. This observation aligns with the RBI’s earlier announcement on the withdrawal, where it highlighted the decline in the total value of Rs 2,000 banknotes in circulation from its peak in March 2018 to March 2023. The RBI had also noted that the denomination was not commonly used for transactions and that an adequate stock of other denominations was available to meet the public’s currency requirements.
Purpose and Timeline for Withdrawal:
Governor Das reiterated that the primary purpose of introducing the Rs 2,000 banknotes was to replenish the system with currency following the demonetization of Rs 500 and Rs 1,000 notes in November 2016. He affirmed that the purpose of the Rs 2,000 banknotes had been fulfilled. Regarding the withdrawal process, Governor Das emphasized that it would be non-disruptive. He also defended the deadline of September 30 set by the central bank, stating that without a timeline, the withdrawal would not be effective. The RBI Governor further remarked that sufficient time had been given, noting the absence of crowds at banks on the first day of the withdrawal period, which commenced on May 23.
The purpose of introducing these high-denomination banknotes had been fulfilled, and the withdrawal process was designed to be non-disruptive. With a deadline of September 30, individuals have been provided with ample time to exchange or deposit their Rs 2,000 banknotes at banks. The RBI’s efforts aim to streamline the currency system and ensure that adequate denominations are available to meet the public’s requirements.