Further to our RBI Press Release dated January 22, 2014 on the subject and in response to the queries raised, the Reserve Bank of India (RBI) clarifies that the rationale behind its move to withdraw banknotes printed prior to 2005 is to remove these banknotes from the market because they have fewer security features compared to banknotes printed after 2005. It is standard international practice to withdraw old series notes.
The RBI has already been withdrawing these bank notes from the market in a routine manner through banks. In Reserve Bank’s view, the volume of the banknotes printed prior to 2005 today, still in circulation, is not significant enough to impact the general public in a large way.
However, it advises that the members of public may initiate the process of exchanging notes at bank branches at their convenience. Further, even July 1, 2014 onwards, members of public can exchange any number of these old series notes from the bank branches where they have their accounts.
The RBI assures that it will continue to monitor and review the process of withdrawal of old series notes so that the public is not inconvenienced in any manner.
Regardless of the above, the RBI reiterates that the notes printed prior to 2005 will continue to be legal tender.
Press Release: 2013-2014/1491
Dated : 24 Jan 2014
Today I visited Khar West Mumbai branch of Union Bank and asked the Cahier at cash counter. He expressed ignorance and asked me to speak to his senior on next Cash counter. He said that he has not received any instructions in this regard and has only read this news in newspaper. He further said that they would not be giving notes in exchange and would be accepting deposit of such notes in bank account only that too only upto 10 pcs.
This shows how slow our system works. RBI had issued Circular on 22nd to withdraw older notes, on 23rd letters to all Banks and on 24th clarifying its position but even after one week the officials at Branch level are not even aware of these circulars or letters.
This is quite surprising specially when we claim to be living in computer age of 21st Century.
Let us hope we improve and change at grass root level.
I believe the RBI Notification is really good for the public at large. But the first step should have been with instructions to all banks to submit with RBI all notes prior to 2005 and keep submitting such notes as received in bank. This will suck lot of 2005 prior money from the system. Even the ATM Machines today are dispensing 2005 prior notes. Rather more number of notes are prior to 2005 as of the banks are circulating more of them in public. EXPERTS Please correct if I am wrong.
What to do if old currency notes are delivered at ATM machine even after 1st April, 2014.
The Reserve Bank of India (RBI) has announced its plans to withdraw all currency noted issued before 2005. Financial experts believe that the move is largely aimed at removing fake or counterfeit currency embedded into the financial system as well help uncover the big black market currency in the country. While the motives of RBI are unquestionably good, there has been some quantum of confusion amongst the general public as to whether the notes they have would need replacement or not. Read on to find out if the currency notes in your pocket or ones stashed in your locker needs to be changed.
Identifying Pre 2005 Currency Notes: Currently the Reserve Bank of India prints currency notes in the denomination of Rs. 5, Rs. 10, Rs. 20, Rs. 50, Rs. 100, Rs. 500 and Rs. 1,000. All the notes printed before the year 2005 do not have the year of printing marked on it. All currency notes printed post 2005 have is year of printing clearly printed in the middle of the bottom row on the backside of the note. If your bank note has no year of printing on the back, it means the note is printed before 2005 and needs to be exchanged with the bank as per the RBI deadline. All notes with the year of printing indicated on the currency note would stay in operation as all of them are posted after 2005
Possible Reasons for Withdrawal: The possible reasons for the withdrawal of old currency is more to do with streamlining the number of currency variants than anything else. Of course the government is worried about the inflow of fake currency and hopes to tackle it by using all notes printed post 2015 which are far more technically superior and difficult to print for fake currency mongers.
How to Exchange Old Currency Notes: So now that you have identified your currency notes and shortlisted the ones that need to be changed, a simple exchange procedure is revealed by the press release of the Reserve Bank of India. First things first, there should be no reason to panic whatsoever as the RBI has clearly stated that all old notes would continue to be completely legal and can be exchanged at any bank after April 1, 2014
All public sector as well as private banks have been asked to create a dedicated exchange counter where both account owners as well as non account owners of that bank or branch can exchange their old currency notes for new ones. These exchange counters will become operation from 1st April 2014.If you have a large amount of old currency notes with you, you may want to exchange them, before 30th June 2014. So why is this date important? All exchanges done before 30th June would be unconditional. For any exchange of more than ten pieces of old Rs 500 or Rs 1000 notes after that date would require identity proof and address to be shared with the bank if you are a non customer of that bank.
This seems to be a good step to put a curb on circulation of fake currency notes because th old series notes have lesser security features as has been clarified by the RBI on 24th jan’14. However RBI should issue strict instructions to all the Banks to accept the old series currency without any inconvenience to public and that strict action be taken against banks who refuse to accept those notes.