Declining trend reported in fake currency circulation: Sitharaman

There is a declining trend in the circulation of fake currencies in the country, Finance Minister Nirmala Sitharaman informed Lok Sabha on Monday.

"The data as reported by RBI and seizure of Fake Indian Counterfeit Notes (FICN) by state police and other agencies as reported by National Crime Records Bureau (NCRB) reveal that there is a declining trend in the circulation of FICN in the country," she said in a written reply.

Sitharaman, however, said West Bengal police reported that the flow of FICNs continues from the Indo-Bangladesh border, particularly in the Malda area.

"However, all such FICNs were of low quality i.e. computer generated or manipulated," the minister noted.

She also said after the withdrawal of the legal tender status of Rs 1,000 and Rs 500 currency notes on November 8, 2016, there have been no reported cases of seizure of High Quality Fake Indian Currency Notes of Rs 2,000 and Rs 500 denomination till early 2019.

"As such, there does not appear to be any appreciable loss now," she said.

To a question whether banks have any policy to replace fake notes or mutilated or scribbled new currencies to avoid any financial losses to the general public, the minister clarified that there will be no credit to customer's account.

Sitharaman said the government has taken various steps to check the smuggling and circulation of fake currencies including the formation of a coordination group and constitution of a Terror Funding and Fake Currency Cell (TFFC) in the National Investigation Agency (NIA).

A memorandum of Understanding (MoU) has also been signed between India and Bangladesh to prevent and counter smuggling and circulation of fake currency notes, the minister said.

She said the agencies have found that fake currency has been smuggled from neighbouring countries and to counter it, security at the international border has been strengthened by using new surveillance technology, deploying additional manpower for round-the-clock surveillance, establishing observation posts along the border, erection of border fencing and intensive patrolling.