New Delhi: With the Reserve Bank of India (RBI) directing banks to ensure that ATMs dispense Rs 100 or Rs 200 denomination notes, reports are doing rounds that the central bank may demonetise Rs 500 banknotes.
Speaking to Money9 Live, Voice of Banking founder and banker Ashwini Rana, said in 2016, the government announced demonetisation which led to Rs 1000 banknote getting withdrawn from the market. Later, in 2023, the Rs 2000 rupee was taken out of circulation by the government.
Rana said that with RBI’s new order to increase the number of Rs 100 and Rs 200 bank notes in ATMs, the question which strikes the mind is whether the Reserve Bank is making any plans to pull back all the Rs 500 notes. The Voice of Banking founder went on to say that whether RBI will withdraw all Rs 500 bank notes from the market or not, only the Reserve Bank can answer, however, the recent direction is an indication that it might be a possibility.
The Voice of Banking founder said that there has been an exponential rise in digital transactions in India. He added that the RBI is also wanting to reduce the cost of printing currency. It is easy for the government to keep a track of digital payments and stop tax evasion. In such a situation, it is quite possible that the circulation of 500 rupee notes will also be gradually phased out like the 2000 rupee note, Rana added.
According to the circular released by the Reserve Bank, 75 per cent of all ATMs (Automated Teller Machines) will have to dispense either Rs 100 or Rs 200 denomination banknotes from at least one cassette by September 30, 2025. The order further stated that by March 31, 2026, 90 per cent of all ATMs shall dispense either Rs 100 or Rs 200 denomination banknotes from at least one cassette.
“As part of an endeavour towards enhancing public access to frequently used denominations of banknotes, it has been decided that all banks and White Label ATM Operators (WLAOs) shall ensure that their ATMs dispense Rs 100 and Rs 200 denomination banknotes on a regular basis…,” the Reserve Bank of India said in a circular.
The RBI has asked banks to ensure 75 per cent of all ATMs dispense Rs 100, Rs 200 notes by September 30, 2025. The circular has sparked speculation about a potential Rs 500 note demonetisation. Biz News Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
