Rs 2,000 note NOT printed in FY20; is the high denomination note slowly getting out of circulation?

No indent for  printing of Rs 2,000 currency notes was made during 2019-20 and no fresh supplies were made by BRBNMPL (Bloomberg image)

High denomination notes of Rs 2,000, introduced after demonetisation to curb black money, fake notes, etc, were not printed in the last fiscal. Also, the circulation of these notes has declined over the years. In 2018, there were 336 crore pieces of Rs 2,000 note, which fell to 329 crores in 2019, and further to 273 crores in 2020, according to RBI’s annual report. While the number of pieces of such notes constituted 2.4 per cent of the total volume of notes at end-March 2020, falling from 3.3 per cent at end-March 2018, the share in value terms too fell from 37.3 per cent at the end-March 2018 to 22.6 per cent at end-March 2020.

The RBI report further said that no indent for the printing of Rs 2,000 currency notes was made during 2019-20 and no fresh supplies were made by BRBNMPL (Bharatiya Reserve Bank Note Mudran Private Limited) and SPMCIL (Security Printing and Minting Corporation of India Limited) as well. The overall indent of banknotes for 2019-20 was lower by 13.1 per cent on-year and the supply of banknotes in the same duration also contracted by 23.3 per cent mainly due to the disruptions caused by the coronavirus pandemic and the subsequent lockdown.

However, the circulation of currency notes of denomination of Rs 500 and Rs 200 rose substantially, both in terms of volume and value over the last three years. For Rs 500 notes, the RBI said that the indent for printing 1,463 crore pieces were issued and 1,200 crore pieces were supplied during 2019-20.

Meanwhile, out of a total of 2,96,695 pieces of Fake Indian Currency Notes (FICNs) detected in the banking sector in the last fiscal, 4.6 per cent were detected at the Reserve Bank and 95.4 per cent by other banks, the report added. There has been an increase of 144.6 per cent, 28.7 per cent, 151.2 per cent and 37.5 per cent in counterfeit notes detected in the denominations of Rs 10, Rs 50, Rs 200 and Rs 500 respectively. On the other hand, the counterfeit notes detected in the denominations of Rs 20, Rs 100 and Rs 2,000 fell by 37.7 per cent, 23.7 per cent and 22.1 per cent, respectively. However, the number of counterfeit notes of Rs 2,000 detected was still at a high level of 17,020 pieces.