Reserve Bank governor Sanjay Malhotra on Wednesday said the central bank will evaluate the outcome of the field trials before taking a final decision on the launch of the polymer banknotes for wider circulation, which it’s targeting by the early part of the next fiscal.
“We are targeting that they (polymer notes) are in circulation, if everything goes as per the plan, in the beginning of the next financial year,” Malhotra told reporters at the customary post-policy presser on Wednesday.
He was quick to add that the monetary authority will evaluate the outcome of the field trials before taking a final decision on the wider circulation of polymer banknotes. The remarks come days after the finance ministry informed Parliament that the government had approved the RBI proposal to conduct field trials of Rs 10 and Rs 20 polymer banknotes. Early last month the central bank has called for expressions of interest from international suppliers for the same.
Polymer banknotes are more durable than conventional paper currency and could help reduce replacement costs, particularly for lower-denomination notes that experience high circulation and frequent wear and tear. Polymer notes can also incorporate advanced security features, including transparent windows and enhanced anti-counterfeiting elements, making them more resistant to forgery.
The government has clarified that there is no proposal to replace paper currency entirely. If introduced, polymer banknotes will circulate alongside existing paper notes.
