India central bank says 96% of 2,000-rupee notes returned, extends deadline by a week

MUMBAI (Reuters) – The Reserve Bank of India (RBI) said on Saturday it would extend its deadline to return the country’s highest denomination 2,000-rupee ($24) currency notes by a week to Oct. 7.

“As the period specified for the withdrawal process has come to an end, and based on a review, it has been decided to extend the current arrangement for deposit/exchange” till Oct. 7, the RBI said in a statement.

While the notes cannot be exchanged at banks after the deadline, people can still do so at 19 designated RBI issue offices, the statement said.

The RBI said in May it would withdraw the notes, permitting their exchange or deposit until Sept. 30. The currency continues to be a legal tender.

The total value of 2,000-rupee notes in circulation was down to 140 billion rupees as of Sept. 29 from 3.56 trillion rupees as of May 19, the RBI said.

The RBI said 96% of the 2,000-rupee currency notes had been returned as of Friday, worth 3.42 trillion rupees ($41.19 billion).

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

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

($1 = 83.0300 Indian rupees)

(Reporting by Siddhi Nayak; Editing by Giles Elgood)