The Reserve Bank of India (RBI) said on Thursday that it would not be adding any fresh supply of currency notes of Rs 2,000 denomination for the financial year 2021-2022. The bank didn't add fresh supplies of the same denomination in the previous year either.
The information came through the RBI's Annual Report that was released on May 26. The report also highlighted the importance of liquidity for economic recovery.
The overall supply of paper cash remained marginally lower by 0.3 percent at 2,23,301 lakh pieces in FY21 against 2,23,875 lakh pieces the previous year, the RBI Annual Report stated.
The Rs 500 denomination note and Rs. 2,000 denomination notes have the highest value of currency in circulation in the economy, making up 85.7 percent of all value that bank notes in circulation. The figure is slightly higher than last year's 83.4 percent.
Rs 500 denomination notes alone makes up for 31.1 percent of all bank notes in circulation in terms of volume.
RBI has consistently kept the volume of the highest denomination low in the country, not adding fresh notes to circulation for years now.
Reserve Bank of India (RBI) in its last year’s Annual Report mentioned that not a single banknote of Rs 2000 denomination was printed in FY20 as it had stopped the printing of high-value denomination notes temporarily due to security concerns.
The number of Rs 2,000 currency notes in circulation came down from 33,632 lakh pieces at end-March 2018 to 32,910 lakh pieces at end-March 2019 and further to 27,398 lakh pieces at end-March 2020, the RBI Annual Report 2020 said.
In 2016, the Central government announced a surprise demonetisation of the two highest-value denomination notes, the old Rs 500 note and the old Rs 1,000 note, in order to curb black money hoarding. The Rs 2,000 notes had been added to the circulation in its aftermath.
