RBI: Banks have to accept deposits in pre-2005 notes

RBI has been receiving queries as well as complaints from the public from across the country that banks were not accepting pre-2005 currency notes

Banks can’t turn away customers depositing pre-2005 currency notes, including the junked Rs 500 and Rs 1,000 ones, the Reserve Bank of India (RBI) said on Monday.
 
In a clarification, RBI said these specified bank notes (SBNs) would also include pre-2005 notes in the denominations of Rs 500 and Rs 1,000.
 
“Banks should accept deposits of pre-2005 banknotes in the denominations of Rs 500 and Rs 1,000 under the scheme, but not reissue these. These notes can be exchanged at RBI offices only,” the regulator said in a clarification issued on Monday.
 

RBI said it has been receiving queries as well as complaints from the public from across the country that banks were not accepting pre-2005 currency notes.

 
With effect from November 9, notes of Rs 500 and Rs 1,000 were de-legalised by the government with the aim to discourage black money hoarders as well as to bring a majority of the unaccounted money into the formal channel of banking.
 
The public in general can exchange the pre-2005 notes in their possession at Ahmedabad, Bengaluru, Belapur, Bhopal, Bhubaneswar, Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur, Jammu, Kanpur, Kolkata, Lucknow, Mumbai, Nagpur, New Delhi, Patna, Thiruvananthapuram and Kochi offices of RBI.
 
“This, however, does not imply that banks cannot accept deposits of pre-2005 banknotes for crediting to the customers’ accounts,” RBI clarified further.

 
The central bank had been in the process of withdrawing pre-2005 notes from circulation since January 2014, and a large percentage of these notes have already been withdrawn. But, in a circular issued in June this year, RBI had said a small percentage of these banknotes were still in circulation and allowed their exchange at the designated RBI branches.
 
Though the pre-2005 notes are being withdrawn, they still continue to remain legal tender.