When will govt launch plastic currency notes?

RBI Governor Sanjay Malhotra, speaking at a press conference after the Monetary Policy Committee meeting, revealed that plastic polymer currency notes will enter circulation from the forthcoming financial year. However, he refrained from providing an exact date or month for the launch of these notes, as the proposal is currently in the pilot stage.

The inquiry into the timeline for the introduction of polymer currency notes arose in Parliament today, with Neeraj Shekhar, a Rajya Sabha member, questioning the government and RBI about their plans and the expected timeframe for releasing these notes. In response, Finance Minister Nirmala Sitharaman confirmed that the RBI had submitted a proposal to the government for producing one billion Rs 10 and Rs 20 polymer banknotes for field trials, and for regular issuance of polymer banknotes in these denominations post successful completion of field trials.

Sitharaman also mentioned that the proposed polymer banknotes will be issued alongside paper-based banknotes. She further clarified that the procurement of plastic notes is currently at an initial stage, and determining the precise launch date or the associated expenditure would not be practical at this point in time. Malhotra stated that the RBI aims to test the performance of polymer currency notes in the Indian climate and infrastructure, with the intention of scaling up the production, either as it stands or with modifications, if the trials prove successful.

The RBI anticipates that the polymer notes will be in circulation at the beginning of the next financial year. Polymer currency notes are created from a thin, flexible synthetic plastic material, as opposed to the traditional cotton paper used in regular notes. These notes exhibit similar characteristics to paper notes in terms of feel and foldability, but they are designed to last significantly longer, approximately two to four times the lifespan of paper notes.

Polymer notes possess additional advantages such as water and dirt resistance, and they often incorporate advanced transparent security windows to enhance their counterfeit resistance. Several nations have embraced polymer currency notes, including Australia, New Zealand, Romania, Russia, China, Canada, Saudi Arabia, Kuwait, and Taiwan.