In order to complete the exercise in a time-bound manner and to provide adequate time to the public, all banks will be able to offer deposit and/or exchange facility for Rs 2000 banknotes until September 30, 2023, RBI said.

The Reserve Bank of India on Friday said that it has decided to withdraw Rs 2,000 denomination banknotes from circulation. However, the notes will continue as legal tender, the central bank said in a statement.

RBI further said that the general public can deposit Rs 2,000 banknotes into bank accounts and/or exchange them into banknotes of other denominations at any bank branch. “Deposit into bank accounts can be made in the usual manner, that is, without restrictions and subject to extant instructions and other applicable statutory provisions,” the bank said in a statement.

In order to complete the exercise in a timely manner and to provide adequate time to the public, all banks will be able to offer deposit and/or exchange facility for Rs 2,000 banknotes until September 30, 2023, RBI said. People are encouraged to deposit and/or exchange these banknotes on or before September 30, 2023, said RBI. The RBI has not specified if Rs 2,000 note will be valid or not after September 30. But, given the deadline for the public to return the notes is September 30, the question arises if the note will be valid after that date or not.

The bank also noted that deposit into accounts can be made without restrictions. The Rs 2,000 banknotes can be deposited into bank accounts and cash requirements can be drawn thereafter, against these deposits.

RBI also said that banks have been instructed to make arrangements to reduce inconvenience to the senior citizens, persons with disabilities, etc., seeking to exchange/deposit Rs 2,000 banknotes. It also highlighted that a non-account holder can exchange Rs 2,000 banknotes up to a limit of Rs 20,000 at a time at any bank branch.

The central bank also mentioned that general public won’t have to pay any fee to avail the exchange facility.

“About 89% of the Rs 2,000 denomination banknotes were issued prior to March 2017 and are at the end of their estimated life-span of 4-5 years. The total value of these banknotes in circulation has declined from Rs 6.73 lakh crore at its peak as on March 31, 2018 (37.3% of notes in circulation) to Rs 3.62 lakh crore constituting only 10.8% of notes in circulation on March 31, 2023. It has also been observed that this denomination is not commonly used for transactions. Further, the stock of banknotes in other denominations continues to be adequate to meet the currency requirement of the public,” RBI said in a statement.

Congress leader Jairam Ramesh reacted to the RBI’s decision by saying, “Typical of our self-styled Vishwaguru. First Act, Second Think (FAST). 2,000 rupee notes introduced with such fanfare after that singularly disastrous Tughlaqi firman of Nov 8 2016 are now being withdrawn.”

Also Read: RBI withdraws Rs 2,000 bank notes from circulation, but will continue to be legal tender