Informal surveys showed that Rs 2,000 banknotes were not commonly used: RBI Governor Das

Reserve Bank of India Governor Shaktikanta Das said during a Confederation of Indian Industry (CII) event that the purpose of the Rs 2,000 banknotes was fulfilled and hence it was withdrawn. He also said that the decision to withdraw the high-denomination banknotes was taken following informal surveys that showed that the note was not commonly being used. 

Following his address at the plenary session of the CII’s annual session on Wednesday, Governor Das told the gathering of industry executives, “We took a view that it was not being used in transactions at all. Through our informal surveys we found that the note was not commonly being used.”

This is in line with what the Reserve Bank had said in its announcement on withdrawal of Rs 2,000 banknotes. It had said that the total value of the banknotes in circulation declined from Rs 6.73 lakh crore at its peak on March 31, 2018, to Rs 3.62 lakh crore on March 31, 2023. “It has also been observed that this denomination is not commonly used for transactions. Further, the stock of banknotes in other denominations continues to be adequate to meet the currency requirement of the public,” the apex bank had said in its announcement. 

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RBI Governor Das, at the CII event, said that the Rs 2,000 note was introduced primarily to replenish the system with the value of the currency whose legal tender status was withdrawn. Das’ comment was similar to what RBI had said in its announcement to withdraw the Rs 2,000 banknotes. The RBI said that the high-denomination banknotes of Rs 2,000 were introduced in November 2016 following the demonetisation of Rs 500 and Rs 1,000 notes.

“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.

Speaking about the deadline of September 30 that the central bank set up for people to exchange or deposit their Rs 2,000 banknotes, Governor Das said that unless there is a timeline, it will not be effective. 

“We have given sufficient time, yesterday there was no crowd at banks,” said the RBI Governor. Tuesday or May 23 was the beginning of the period till September 30 when people can go to banks and exchange or deposit their Rs 2,000 banknotes. 

“There is no concern or major issue coming up. It was time to take Rs 2,000 out. High denomination currency remaining here and there can create other collateral issues,” said Governor Das. 

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