In this respect read the following News items from Business Standard News Paper that throws further light on soiled Notes.
(1) BUSINESS STANDARD
February 24, 2011 Last Updated at 20:54 IST)
Stop re-circulation of soiled notes: RBI to banks
notes may soon be a thing of past as the Reserve Bank of India (RBI)
has asked all bank branches handling large amounts of currency to put in
place note-sorting machines by the end of next month with a view to
halting re-circulation of unfit currency notes.
Reserve Bank is committed to a 'clean note' policy. RBI exchanges
soiled notes for clean ones, and mutilated notes for new ones subject to
certain conditions," central bank Governor D Subbarao said at the
Convocation function of Sambalpur University here.
pursuit of our clean note policy and to check counterfeiting, we also
prescribed that by March 31, 2011, all bank branches with cash receipts
of over Rs 50 lakh per day be equipped with a note sorting machine so
that every high denomination currency note is checked for fitness and
genuineness before being put back in circulation," he said.
he said, the RBI has instructed banks to ensure that the notes that
they issue through their ATMs are also pre-checked for genuineness and
pointed out that cost and longevity are important dimensions of
currency management. "We are a large cash economy; in fact, we are the
second largest producer and consumer of currency in the world, next only
to China. Producing such a large amount of currency is expensive," he
(2) BUSINESS STANDARD
Press Trust of India | New Delhi
May 13, 2013 Last Updated at 00:37 IST
RBI gears up for plastic notes as 20% paper bills get soiled
the Reserve Bank of India (RBI) gears up for a trial of plastic
currency notes, it has to dispose of soiled paper currency bills worth
an estimated amount of over Rs 2 lakh crore a year.
an average, one out of five paper notes in circulation (over 20 per
cent) gets disposed of every year after getting soiled and the number of
such soiled currency bills stood at over 13 billion units during the
financial year ended March 31, according to the latest data available
figures are not yet available for 2012-13, but the number of soiled
currency notes has remained above 13 billion for at least three
to RBI data, the total value of all currency notes in circulation stood
at over Rs 10.5 lakh crore at the end of financial year 2011-12.
soiled notes valued at an estimated amount of Rs 2.05 lakh crore had to
be moved out of circulation by RBI during that financial
(3) BUSINESS STANDARD
July 16, 2001 Last Updated at 00:00 IST
Soiled Notes Eradication drive
Reserve Bank of India's (RBI) city office has embarked on the second
phase of its campaign to eradicate the menace of soiled and mutilated
currency notes of Re 1, Rs 2 and Rs 5 denominations from all parts of
Gujarat, according to RBI regional director (Gujarat) V S Das.
that the first phase of the drive launched last year was very fruitful,
Das revealed that because of the campaign notes packed in plastic
packets have disappeared from several places including Ahmedabad. A
similar drive is already continuing in Bhavnagar, Rajkot and Vadodara
and other centers such as Bhuj, Deesa, Gandhidham, Jamnagar, Junagadh,
Porbandar, Surat, would be taken up shortly, he added.
that the central bank has also stepped up remittances of coins to
various Gujarat towns having this problem of soiled and mutilated notes,
Das said, "Public sector banks have also been urged to rise to the
occasion and provide exchange facilities to the members of public at all
their branches. In this connection, a letter has been sent by the RBI
deputy governor to the chairmen of all concerned public sector banks.
"Maintaining that it is necessary that people stop using and accepting
such mutilated and soiled currency notes, Das advised anyone who comes
across such notes should tender them for exchange at the counters of
public sector banks or at the mobile counters specifically moving around
in various districts of Gujarat.
that RBI is closely monitoring the drive and it is determined to solve
the problem, he said that within the next few months entire Gujarat
would be cleared of all the soiled and mutilated notes currently in
(4) BUSINESS STANDARD
January 5, 2002 Last Updated at 00:00 IST
RBI Preferring To Burn 90% Of Soiled Notes
of staff at its currency note examination sections and a higher amount
of money in circulation are forcing the Reserve Bank of India (RBI) to
incinerate soiled notes at a faster clip.
RBI's two new mints have contributed to the large increase in the
supply of fresh notes, while the capacity of its note examination
section has declined.
There are as many as 4,000 currency chests in the country and 101 note examination sections.
spokesperson Alpana Kilawala said the total number of currency notes in
circulation has increased in the economy due to which more notes were
getting soiled and were being returned to the note examination section.
such note examination sections were facing severe shortage of trained
staff due to which such notes were straightway discarded/incinerated.
increase in currency under circulation also means chests at all
locations were full to the brim. So, replacing the old notes with new
ones was the best option.
on the possibility of fake notes being replaced by real ones, Kilawala
said, "The RBI has experts who are provided regular training and the
possibility of fake notes evading detection is remote in any case."
officials here said that as much as 90 per cent of notes deposited in
the RBI currency chest were being discarded. In the process, fake notes
were also being eradicated.
to the report of the committee on currency management, soiled notes
returning form circulation as the total of those received by RBI and
those awaiting removal from chests rose from 6,300 million pieces in
1984-85 to about 7,000 million pieces in 1988-89.
on date the figure is approximately 6,855 million pieces. At present
notes with denomination Rs 1, Rs 2, Rs 5, Rs 10, Rs 20 and Rs 50 were
procurement of several of the Raw material needed for producing the Bank
Notes are elaborate and involve cumbersome process and procedures.
Some of them being imported long term contracts are also involved for
uninterrupted supplies. The process of printing Bank Notes is not just
a quick act of Printing the Notes like Xerox copying on Photocopier
machines and pack them for onward supply to RBI. End to end,
several procedures are involved to print and finish the Notes with
several processes and prints from machines accounted by multiple cross
checking points to ensure that the printed sheets do not disappear from
the presses. The first multiple up print on blank paper from machine
ending into packet of 100/1000 Notes in the other end takes a months
travel in normal course. Under such cumbersome procedures it takes
minimum 280-300 working days to complete the process of Indent supplies
to the extent of 1800 to 2000 million pieces in several denominations.
Therefore a long drawn plan required involving co-ordination between
various agencies in RBI, Ministry, Presses and suppliers necessitates
five year projections to plan out the procurement action. RBI has been attempting to streamline the entire issue concerning Currency Management in which the Paper Money Printing and issue are integral part.
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