RBI withdraws ₹2000 banknotes on May 19, 2023, as part of the "Clean Note Policy" and to streamline currency circulation.
May 31, 2023
In an effort to streamline currency circulation and promote the "Clean Note Policy," the Reserve Bank of India (RBI) has decided to withdraw the ₹2000 denomination banknotes from circulation on May 19, 2023. The decision comes as these banknotes, introduced in November 2016, had served their intended purpose and were nearing the end of their estimated life span of 4-5 years.
It has been observed that this denomination is not widely used for transactions, and the stock of banknotes in other denominations is deemed sufficient to meet the currency requirements of the public.
According to RBI data, approximately 89 percent of the ₹2000 banknotes were issued prior to March 2017. The value of these banknotes has dropped from ₹6.73 lakh crore (37.3% of notes in circulation) in March 2018 to ₹3.62 lakh crore (10.8% of notes in circulation) by March 31, 2023.
The central bank has instructed banks to immediately stop issuing ₹2000 banknotes. The withdrawal of the banknotes will continue in phases, while still being considered legal tender. The RBI issued separate guidelines to banks to ensure a smooth and efficient process.
Individuals can deposit or exchange these banknotes at any bank branch without any restrictions. Starting from May 23, 2023, ₹2000 banknotes can be exchanged for other denominations up to ₹20,000/- at a time until September 30, 2023, including at the 19 Regional Offices (ROs) of RBI.