The Reserve Bank of India had indicated that around 99.3 per cent of banned Rs 500 and Rs 1000 notes have returned to the banking system, showing that only a small percentage of currency was left out of the system after the Narendra Modi-led government's unprecedented note ban aimed at curbing black money and corruption. In its annual report for 2017-18, the RBI said that the exercise of counting the currency that was returned in the limited period window provided by the government to exchange or deposit the demonetised currency, is finally over.
Of the £154.1 billion worth Rs 500 and Rs 1000 notes in circulation on November 8, 2016, notes worth £153.1 billion have been returned; just £1.07 billion of the junked currency did not return to the banking system. Following the note ban, old junked notes, called specified bank notes (SBNs), were allowed to be deposited in banks with unusual deposits coming under scrutiny. The report said, “The humongous task of processing and verification of specified bank notes was successfully achieved.”
The received SBNs were verified, counted, and processed in a sophisticated high speed currency verification and processing system (CVPS) for accuracy and genuineness and then shredded. RBI said the processing of SBNs has since been completed. “The total SBNs returned from circulation is Rs 15,310.73 billion.” The government replaced old Rs 500 notes with new ones, but no replacement for Rs 1000 notes have been made.
Post-demonetisation, the RBI spent £796.5 million in 2016-17 on printing new Rs 500 and Rs 2000 and other denomination notes, more than double the £342.1 million spent in the previous year. The annual report said that in 2017-18 (July 2017 to June 2018), it spent another £491.2 million on printing of currency. “Counterfeit notes detected in SBNs decreased by 59.7 and 59.6 per cent in the denominations of Rs 500 and Rs 1000, respectively.”
“Compared to the previous year, there was an increase of 35 per cent in counterfeit notes detected in the denomination of Rs 100, while there was a noticeable increase of 154.3 per cent in counterfeit notes detected in the denomination of Rs 50,” RBI said adding that counterfeit notes detected in the new Rs 500 and Rs 2,000 notes during 2017-18 were 9,892 and 17,929 as against 199 and 638, respectively, during the previous year.
