SBI recently released a circular instructing all branches to simplify the exchange process for Rs 2000 notes. According to the circular, customers will no longer be required to fill out any forms to exchange either 10 notes of Rs 2000 or a total of Rs 20,000 at one time. Additionally, individuals will not need to present any identity cards while exchanging these notes.
Branch managers have been directed to adhere to these guidelines to ensure a smooth and efficient note exchange process.
It is important to note that the Reserve Bank of India (RBI) announced the withdrawal of Rs 2000 denomination notes from circulation on Friday. People have until September 30 to return their Rs 2000 notes, with a maximum limit of Rs 20,000 per exchange. This means that individuals can exchange 10 notes of Rs 2000 in a single transaction. In light of this, SBI has instructed that no identity card or form is necessary to exchange Rs 20,000.
Printing of Rs 2000 Notes Halted for Four Years
It is worth mentioning that the printing of Rs 2000 denomination notes was ceased back in 2018-19. Since then, there has been a significant decline in their circulation. Currently, only 10 percent of the currency notes in circulation are of the Rs 2000 denomination, whereas in March 2018, it accounted for nearly 31 percent. The introduction of the Rs 2000 note aimed to address the cash shortage in the market following the demonetization. Initially, people used it, but gradually, the Rs 2000 note became scarce in the market.
Impact of the Decision
Economists believe that the withdrawal of the Rs 2000 note from circulation will not have a substantial impact on the economy or day-to-day transactions. Arvind Panagariya, former Vice Chairman of NITI Aayog, stated that the Reserve Bank of India’s (RBI) decision to recall the Rs 2000 currency notes will not directly affect the economy since the withdrawn notes can be replaced by lower denomination notes of the same value. Panagariya further explained that this move is likely aimed at making it more difficult for illegal money to circulate. Former deputy governor of RBI, R Gandhi, concurs with this view, stating that the withdrawal of Rs 2000 banknotes will significantly curb the circulation of black money.
