The Reserve Bank of India (RBI) has announced that it will withdraw ₹2,000 notes from circulation. The notes will remain legal tender, but they can only be exchanged or deposited in bank accounts until September 30, 2023.
The RBI started printing the ₹2,000 note in November 2016, after Prime Minister Narendra Modi scrapped high-value ₹500 and ₹1,000 notes overnight. The ₹2,000 note was introduced as a temporary measure to increase the availability of cash in the economy.
However, the RBI said that the objective of introducing the ₹2,000 note has been met, as banknotes in other denominations are now available in adequate quantities. As a result, the RBI has stopped printing ₹2,000 notes.
From May 23, 2023, people can exchange ₹2,000 notes for notes of other denominations at any RBI regional office or bank. The exchange limit is ₹20,000 per person per day.
After September 30, 2023, ₹2,000 notes can still be deposited in bank accounts. However, they will not be accepted for exchange.
The RBI has said that it will not impose any penalty on people who deposit or exchange ₹2,000 notes after the deadline. However, people who are found to be in possession of ₹2,000 notes after the deadline may be subject to investigation by law enforcement agencies.
The RBI has also said that it will continue to accept ₹2,000 notes for payment of government dues and taxes.
The withdrawal of ₹2,000 notes is a significant development, as it will reduce the amount of cash in circulation. This is likely to have a positive impact on the economy, as it will help to reduce inflation and make it easier for the government to track financial transactions.