Is govt planning to phase out Rs 2000 notes?

The printing of Rs 2000 notes has been substantially reduced. It has been decided to limit the printing of 2000 currency notes to minimum. This is nothing new, a FinMin official said.

The printing of Rs 2000 banknote, introduced post-demonetisation in November 2016, has been reduced to the "minimum" by the Reserve Bank, a top finance ministry official said on Thursday.

Soon after the sudden decision to ban old Rs 500/1000 currency notes by the government, the Reserve Bank had come out with the Rs 2000 currency note along with a new look Rs 500 note as part of its massive remonetisation exercise.

The senior official said the RBI and the government from time to time decides on the quantum of currency to be printed on the basis of money in circulation.

When the Rs 2000 note was launched, it was decided that the printing would be "scaled down" going forward, since the new high currency value note was meant for meeting the remonetisation need.

"The printing of 2000 rupee notes has been substantially reduced. It has been decided to limit the printing of 2000 currency notes to minimum. This is nothing new," the official said.

According to the RBI data, there were 3,285 million pieces of Rs 2000 notes in circulation at end-March 2017.

A year after (on March 31, 2018), there was only a marginal increase in the number at 3,363 million pieces.

Of the total currency in circulation amounting to Rs 18,037 billion at end-March 2018, Rs 2000 notes accounted for 37.3 per cent, down from 50.2 per cent at end-March 2017.

The old 500/1000 bank notes that were scrapped in November 2016 accounted for around 86 per cent of the total currency in circulation at that time.

Photograph: Mukesh Gupta/Reuters