Pre-2005 notes phase out: Banks gear up for exchange rush
27 Jan 2014 10:24 PM GMT
Banks are gearing up to meet the expected customer rush for exchanging currencies after the Reserve Bank of India’s (RBI) decision to phase out notes issued prior to 2005.
'There will be some pressure, but we are confident that we will handle it. We have cash depositing machines in large numbers which will help ease pressure. By end of February, we will around have 1,000 cash depositing machines,' State Bank of India deputy managing director P K Malhotra said. This is a good initiative as it will help remove fake currency which are in circulation, he said, adding that notes which are printed after 2005 have more security features.
According to Oriental Bank of Commerce CMD S L Bansal, the bank will adhere to all the directions of the Reserve Bank of India regarding withdrawal of notes. 'I don't feel there would be a great rush for exchange of notes because most of such currency would be out of system,' he said, adding that generally notes have shelf life of 10 years only. A senior official of Punjab National Bank said their branches are fully geared up to meet the rush for currency exchange. The Reserve Bank on 22 January decided to withdraw all currency notes issued prior to 2005, including Rs 500 and Rs 1,000 denominations, after 31 March in a move apparently aimed at curbing black money and fake currencies.
The public are required to approach banks for exchanging these notes.
The RBI had also said the volume of such notes that were being withdrawn from circulation was not significant. From 1 July, 2014, persons seeking exchange of more than 10 pieces of Rs 500 and Rs 1,000 notes will have to furnish proof of identity and residence to the bank. The notes printed prior to 2005 will continue to be legal tender even after 1 July. Any number of these old series notes can be exchanged by people at bank branches where they have accounts, RBI had said. As per RBI data, 7,351 crore pieces of currency notes were in circulation on March 31, 2013. Of this, 14.6 per cent were Rs 500 notes and 5.9 per cent were Rs 1,000 notes.
'There will be some pressure, but we are confident that we will handle it. We have cash depositing machines in large numbers which will help ease pressure. By end of February, we will around have 1,000 cash depositing machines,' State Bank of India deputy managing director P K Malhotra said. This is a good initiative as it will help remove fake currency which are in circulation, he said, adding that notes which are printed after 2005 have more security features.
According to Oriental Bank of Commerce CMD S L Bansal, the bank will adhere to all the directions of the Reserve Bank of India regarding withdrawal of notes. 'I don't feel there would be a great rush for exchange of notes because most of such currency would be out of system,' he said, adding that generally notes have shelf life of 10 years only. A senior official of Punjab National Bank said their branches are fully geared up to meet the rush for currency exchange. The Reserve Bank on 22 January decided to withdraw all currency notes issued prior to 2005, including Rs 500 and Rs 1,000 denominations, after 31 March in a move apparently aimed at curbing black money and fake currencies.
The public are required to approach banks for exchanging these notes.
The RBI had also said the volume of such notes that were being withdrawn from circulation was not significant. From 1 July, 2014, persons seeking exchange of more than 10 pieces of Rs 500 and Rs 1,000 notes will have to furnish proof of identity and residence to the bank. The notes printed prior to 2005 will continue to be legal tender even after 1 July. Any number of these old series notes can be exchanged by people at bank branches where they have accounts, RBI had said. As per RBI data, 7,351 crore pieces of currency notes were in circulation on March 31, 2013. Of this, 14.6 per cent were Rs 500 notes and 5.9 per cent were Rs 1,000 notes.
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