As the process to exchange ₹2,000 notes kicks off today, those who hold the wads of pink coloured currency in their safe vault can now do so. The Reserve Bank of India announced the withdrawal of highest denomination currency notes in a notification issued on May 19.
Here we elucidate the complete process of exchanging the soon-to-be-extinct currency into the notes of smaller denomination i.e., ₹100 and ₹500.
The facility of exchanging ₹2,000 notes is now available at banks as well as the regional offices of Reserve Bank of India (RBI).
The entire process of exchanging notes is claimed to be convenient and simple. The State Bank of India (SBI) recently clarified that there is no need for customers to share their KYC (Know Your Customer) details or submit requisition slips for exchanging the notes.
A step-by-step guide to exchange ₹2,000 notes
1. The exchange facility commences on May 23 and will continue till Sep 30, 2023. This means you have a total of four months and one week to exchange the notes. So, there is absolutely no need to panic at all. There is plenty of time to carry out the exchange.
2. The exchange of notes can happen at any bank regardless of the fact you are a customer or not. For instance, even if you are not a customer of the SBI, you can still go there to exchange these notes.
3. The one-time cap to exchange the note is ₹20,000. This means you can exchange 10 notes at one time.
If you want to exchange, for instance, ₹1,00,000 then you can go to the bank for five consecutive days and exchange ₹20,000 in one day to be able to exchange a total of ₹one lakh in five days.
4. Aside from a bank branch, one can also visit any of the 19 regional offices of RBI.
5. There is an option of exchange of notes with business correspondents (BC) who are often seen in small towns and rural areas where they are appointed to facilitate banking in the unbanked areas. The limit of exchanging notes with BCs is ₹4,000 in one day.
6. In case you are travelling abroad and are unable to exchange notes before Sept 30, your currency will continue to be legal tender. The ongoing exercise is being done for withdrawal of currency. This is not demonetisation, as it is believed by some.
7. There is no fee to be charged by the banks for this exchange facility. The exchange is being offered completely free of charge.
RBI Governor Shaktikanta Das on Monday said in a statement, “From time to time, RBI withdraws notes of a particular series and issues fresh notes... We are withdrawing ₹2000 notes from circulation but they will continue as legal tender. It is a part of the RBI's currency management operations.”
About 89 per cent of the ₹2,000 denomination notes were issued prior to March 2017 and are at the end of their estimated life span of four-five years.
“The total value of these bank notes in circulation has declined from ₹6.73 lakh crore at its peak as on March 31, 2018 (37.3% of notes in circulation) to ₹3.62 lakh crore constituting only 10.8% of notes in circulation on March 31, 2023,” RBI said.