India to get its first plastic notes next year: RBI governor shares timeline
The government has authorised the Reserve Bank of India to print up to 2 billion polymer (plastic) notes - 1 billion each in the Rs 10 and Rs 20 denominations for field trials. At present, there is no proposal to replace paper currency entirely.
India is set to introduce its first plastic or polymer banknotes next year, according to the Reserve Bank of India (RBI) governor, Sanjay Malhotra. Speaking at a post-monetary policy press conference, Malhotra announced that the polymer notes will enter circulation at the beginning of the next financial year, contingent on the successful outcome of the pilot project.
The government has authorized the RBI to print up to 2 billion polymer banknotes in the denominations of Rs 10 and Rs 20 for field trials. Malhotra emphasized that both polymer and paper notes will continue to circulate as legal tender. He explained that the polymer notes aim to enhance durability and expand the capacity to meet the growing needs of the economy.
In terms of durability, polymer notes have been in circulation for over 30 years in various countries, demonstrating a lifespan that is two to four times longer than that of paper notes. Additionally, the polymer notes offer a higher capacity to handle the increasing demands of the economy, Malhotra stated. He also highlighted the importance of incorporating advanced security features in the polymer notes to prevent counterfeiting.
The RBI has issued a global tender to secure suppliers for the polymer substrate sheets embedded with security features. Prospective suppliers must meet stringent eligibility criteria, including obtaining government security clearance and demonstrating prior experience in supplying polymer banknote substrates to central banks. The project is currently in the preliminary phase, with Malhotra calling it a pilot to test the performance of the notes in Indian conditions.
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