India’s central bank says 93% of 2,000-rupee notes returned since May

MUMBAI (Reuters) – The Reserve Bank of India (RBI) on Friday said 93% of the country’s highest denomination 2,000-rupee currency notes – worth 3.32 trillion rupees ($40.14 billion) – have been returned since its decision to withdraw them from circulation.

The RBI had said in May that it would withdraw these high-value notes, permitting their exchange or deposit until Sept. 30.

The total value of 2,000-rupee notes in circulation was down to 3.56 trillion rupees as of May 19, from 3.62 trillion rupees as on March 31 – the end of the last fiscal year – the central bank said in a statement.

Meanwhile, 240 billion rupees worth of these notes are in circulation, as of Aug. 31, it said.

Data collected from major banks indicated that about 87% of the banknotes received by lenders was in the form of deposits, while around 13% exchanged for other denominations, the RBI said.

The 2,000-rupee notes were introduced in 2016 to replenish the Indian economy’s currency in circulation after the government’s shock move in 2016 to demonetize the economy by scrapping high-value banknotes overnight.

However, the central bank has frequently said that it wants to reduce high-value notes in circulation and had stopped printing 2,000-rupee notes over the past four years.

($1 = 82.7131 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Dhanya Ann Thoppil)