Reserve Bank of India has completed the task of processing and verification of the large value notes (Rs 500, Rs 1,000) which were withdrawn from circulation following their demonetisation in November 2016.
The total value of banned notes, which RBI refers to as Specified Bank Notes (SBNs), in circulation as on 8 November 2016, post verification and reconciliation, was Rs 15.41 trillion.
As many as 99.3 per cent of the demonetised notes have been returned, the Reserve Bank of India said in its annual report.
The total value of SBNs returned to banks is Rs 15.31 trillion, RBI said in its 2017-18 annual report.
An amount of Rs 107.20 billion in demonetised notes were not returned, as of 30 June 2018. They formed part of the liability head ‘Notes issued’, and have been removed from the balance of ‘Notes issued’ and transferred to a specific head created for the purpose called ‘Other Liabilities and Provisions’.
All future payments of the exchange value of SBNs to eligible tenderers, under the rules framed by the Government of India, will be made out of the specific head, RBI said.
The process of verifying banned notes involved working in two shifts under strenuous conditions, maintaining detailed records and planning effectively without compromising on other functions of currency management. The task of processing SBNs was achieved with the co-ordinated efforts put in by the workforce of the Issue Department of the Reserve Bank, it added.
The processing capacity was augmented by resorting to night shifts (along with day shifts), working for 6 days a week, using 8 additional machines available with commercial banks and taking 7 machines on lease from vendors.
The matter relating to the exchange of SBNs held by certain District Central Cooperative Banks (DCCBs), which could not be accepted by RBI under extant legal provisions, is pending before the Court. The payment of the value of such SBNs is subject to the orders of the Court.
During the year 2017-18, 27.7 billion pieces of banknotes were disposed as against 12.5 billion pieces the previous year, mainly on account of accelerated processing of SBNs of Rs 500 and Rs 1000 denominations.
The value of banknotes in circulation increased by 37.7 per cent over the year to Rs 18.03 trillion as at end-March 2018. The volume of banknotes, however, increased by 2.1 per cent.
In value terms, the share of Rs 500 and Rs 2000 banknotes, which had together accounted for 72.7 per cent of the total value of banknotes in circulation at end-March 2017, increased to 80.2 per cent as at end-March 2018.
The focus of currency management in 2017-18 remained on remonetisation, processing and reconciliation of SBNs received at the Reserve Bank from circulation.
Ceaseless efforts towards remonetisation continued during the year which saw the issuance of banknotes of Rs 10 and Rs 50 under the new series and introduction of Rs 200, a new denomination.