Tag:GS3||Economy||Banking and Financial Sector||Money

Why in News?

Recently, RBI clarified in it’s answer to an RTI that it has stopped printing Rs 2000 notes.

Background

• Government started circulation of Rs 2000 notes post demonetization in 2016.
• RBI printed 3,542.991 million notes of Rs2000 in 2016-17. Next year it was reduced to 111.507 million notes. In 2018-19 it further reduced to 46.690 million.
• In terms of circulation , In March 2018 it represented 3.3% of the volume (3.3 notes per 100 notes) and 37.3% in value (Rs 37.3 per 100rupees). By 2019 it reduced to 3%in volume and 31.2% in value.

Why this move?

• Increase in Fake currency circulation,RBI in it’s annual report mentioned the menace of High quality fake notes.
• To prevent hoarding of the High value currency which leads to Black Money.

Currency Printing and Circulation in India

• The Reserve Bank of India (RBI) prints and manages currency in India and Government of India regulates circulation and denominations.
• The Indian government is solely responsible for minting coins.
• The RBI is permitted to print currency up to 10,000 rupee notes.
• Section 22 of the RBI act, 1934 gives RBI the authority to issue currency notes.
• Bharatiya Reserve Bank Note Mudran Private Limited (BRBNMPL) it is a wholly owned subsidiary of the RBI which has it’s corporate office at Bengaluru. It has two press, Mysuru -Karnataka and Salboni- West Bengal. Majority of the notes are being printed from here.
• The Security Printing & Minting Corporation of India Ltd (SPMCIL). is a Mini-Ratna Central Public Sector Enterprise. It is a wholly owned by Government of India. It has two units Nasik – Maharashtra and Devas – Madhya Pradesh. Remaining notes are printed here. It also prints other govt documents like security papers, Cheques ,Bond papers etc.
• The Government of India has the sole right to mint coins. Coinage Act, 1906 gives GOI the responsibility to mint coins. The designing and minting of coins in various denominations is also the responsibility of the Government of India. Coins are minted at the four India  Government Mints at Mumbai, Alipore(Kolkata), Saifabad(Hyderabad), Cherlapally (Hyderabad) and NOIDA (UP).