The Reserve Bank of India (RBI) is preparing to introduce polymer i.e. plastic notes in the country. RBI Governor Sanjay Malhotra has given this information on Friday. He told that the proposal of polymer note is still in the initial stage and it is being considered further. However, if reports are to be believed, a pilot project in this regard can be announced soon. In the initial phase, notes of Rs 10 and Rs 20 can be chosen, because these are the most used and get spoiled quickly.
A week ago TV9 had revealed
TV9 Digital had revealed last week that the Reserve Bank of India is considering introducing plastic notes in the country. This proposal was discussed during the board meeting of RBI. Today the RBI Governor has given big hints on the introduction of plastic notes. He said, “This proposal is under consideration.” If this proposal is implemented then plastic notes can come into the country.
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Why are plastic notes being introduced?
RBI is considering adopting plastic notes because the cost of printing and maintenance of paper notes is continuously increasing. According to RBI’s FY25 annual report, the cost of printing notes has increased to Rs 6,372.8 crore, while it was Rs 5,101.4 crore in FY24. Although the initial cost of producing polymer notes is high, they are much more durable than paper notes. This will reduce the need to print new notes in the long run and can also lead to huge savings in expenses. Moreover, the country’s ATM and cash management systems are now so modern that they can easily recognize and process polymer notes.
Bad and torn notes are a big challenge
Changing damaged and torn notes is also a big challenge for RBI. About 23.8 billion old and damaged notes were taken out of circulation during FY25, which is 12.3 percent more than the previous year. Most of these included Rs 500 notes. Despite the rise in digital payments, the demand for cash in the country is continuously increasing and by May 15, the total currency in circulation reached a record level of Rs 42.86 lakh crore. In such a situation, polymer notes will remain safe and useful for a longer time, due to which the pressure of changing and reprinting notes can be significantly reduced.
There was discussion 10 years ago also
This is not the first time that plastic notes are being discussed in the country. Even about 10 years ago, RBI had suggested printing plastic notes. This scheme has again come into discussion due to the increasing expenditure on printing of paper notes and a large number of old notes getting spoiled and destroyed.
In February 2014, the government had told Parliament that Rs 10 plastic notes would be tested. For this, five cities of the country with different climatic and geographical conditions were selected. These included Kochi, Mysore, Jaipur, Shimla and Bhubaneswar. However, this scheme was stopped due to technical and operational problems at that time. Now RBI is once again exploring possibilities regarding plastic notes.
Also read- This country’s plastic note is the strongest in the world, what is its specialty?
