Govt to conduct field trial of plastic banknotes

Rs 10 notes to be tested in 5 places, amid complaints of fake Rs 500 and Rs 2,000 notes

The government will conduct a field trial with plastic banknotes at five locations of the country, Minister of State for Finance Arjun Meghwal said in a written reply to Lok Sabha on Friday.

The reason for such a move is that plastic banknotes are expected to last longer than cotton substrate-based banknotes, Meghwal said.

“It has been decided to conduct a field trial with plastic banknotes at five locations of the country. Approval for procurement of plastic substrate and printing of bank notes of Rs 10 denomination on plastic banknote substrates has been conveyed to the Reserve Bank of India,” Meghwal said as per an official statement by the Finance Ministry.

“Over the years, central banks across the world have been exploring different solutions for extending the lifecycle of banknotes. These include introduction of plastic banknotes and other developments in banknote substrates for enhancing durability including use of natural fibre blends, varnish of banknotes etc,” the statement said.

Such a move comes even as banks and the RBI deal with multiple complaints of fake Rs 500 and Rs 2,000 notes being dispensed by ATMs. There have also been cases of notes being dispensed without requisite features.