RBI to Soon Issue New ₹100 and ₹200 Notes Bearing Governor Sanjay Malhotra's Signature; Existing Notes to Remain Valid Amidst Rise in Both Cash and Digital Transactions.
RBI: The Reserve Bank of India (RBI) has announced the upcoming release of new ₹100 and ₹200 banknotes. While the design will remain unchanged, the new notes will bear the signature of the current Governor, Sanjay Malhotra. This is standard procedure following the appointment of a new governor, with new notes featuring their signature subsequently issued.
Will Old ₹100 and ₹200 Notes Be Demonetized?
Following this announcement, the primary question arises: will the existing ₹100 and ₹200 banknotes be demonetized? No! The RBI has clarified that the old notes will remain valid and there is no need for citizens to exchange them. New notes will soon enter circulation via banks and ATMs, but the old notes will continue to be legal tender.
Continued Rise in Cash Usage
Despite the surge in digital transactions in recent years, cash circulation has also increased. According to RBI data, cash circulation stood at ₹13.35 lakh crore in March 2017, rising to ₹35.15 lakh crore by March 2024. This demonstrates the continued significance of cash transactions, even with the promotion of digital payments.
Significant Surge in UPI Transactions
While cash usage has increased, digital payments have also witnessed record growth. UPI transactions totaled ₹2.06 lakh crore in March 2020, increasing to ₹18.07 lakh crore by February 2024. Furthermore, the total number of digital transactions for the entire year 2024 surpassed 172 billion. This signifies a growing preference for digital payment methods among the population.
States with Highest ATM Withdrawals?
Reports indicate that states like Delhi, Uttar Pradesh, Tamil Nadu, West Bengal, and Karnataka recorded the highest cash withdrawals during fiscal year 2024. Demand for cash naturally increases during festivals and elections. Meanwhile, limited access to digital payments in rural areas continues to drive reliance on cash.
Impact of the New Notes?
The RBI's release of new ₹100 and ₹200 notes will not significantly alter the banking system, as it's a routine process. The design remains unchanged, ensuring no inconvenience to the public. However, increased supply of new notes will improve cash availability, maintaining smooth cash flow in the market.
