99% of demonetised notes received back by RBI

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99% of demonetised notes received back by RBI

Noting that the optimal system of denominations of currency is one that minimises their number "and concurrently increase the probability of proffering exact change", the central bank said that "in the lower end of the denomination series, Rs 200 is the missing one".

About Rs 16000 crore of the demonetised notes did not come back.

This is the first time the RBI revealed details on the demonetised notes after Prime Minister Narendra Modi scrapped old Rs 1000 and Rs 500 currency notes in November past year.

According to the person, the printing of Rs 2,000 notes was stopped about six months back. The government gave a 50-day window till December 30 to deposit the old notes. A collateral damage as a result of rise in printing and other cost was dividend RBI pays to the government.

In the report on fake Indian currency notes (FICA), RBI said the past fiscal had yielded 7,62,072 pieces of FICN, which was higher than the 6,32,926 such notes seized in 2015-16.

This goes on to suggest that just 1.3 per cent of the notes were not returned. Instead, a new Rs 2,000 note was introduced post note ban.

In its report, the RBI has also said that the total value of banknotes in circulation has dropped by 20.2 percent during the past year.

The report also noted that the value of banknotes in circulation declined by 20.2 per cent over the year to Rs 13.10 lakh crores as on March 31, 2017. Next in line for printing is the Rs 1,000 note. Financial institutions reported 94,836 suspicious transactions as against 40,333 transactions previous year, the RBI said.

"Buoyed by festival demand and a bumper kharif harvest, a renewed pick-up in currency in circulation was beginning to form in Q3 when demonetisation abruptly stifled it".

In a bid to meet cash requirements, the RBI introduced a new denomination - Rs 2,000 notes. "The economists deserve a Nobel Prize", Chidambaram said, sarcastically. That is 1 per cent. Shame on RBI which "recommended" demonetisation.

Following the report, the Opposition quickly poun-ced on the data to attack the government, with former finance minister P. Chidambaram wondering if demonetisation was "a scheme created to convert black money into white".

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