New Delhi: The government has approved a proposal to introduce polymer currency notes, but an exact launch date has not been decided.
Finance Minister Nirmala Sitharaman informed the Rajya Sabha that the Reserve Bank of India (RBI) plans to introduce one billion pieces each of Rs 10 and Rs 20 polymer banknotes for field trials.
The notes may be issued regularly only after successful trials. They will circulate alongside paper notes and will not immediately replace them.
Procurement At Early Stage
Responding to Rajya Sabha member Neeraj Shekhar on August 11, Sitharaman said the government had approved the RBI proposal.
However, procurement is still at an early stage. Therefore, the government cannot determine the introduction date or expenditure involved.
RBI Eyes Next Financial Year
RBI Governor Sanjay Malhotra indicated that polymer notes could enter circulation at the beginning of the next financial year, provided everything goes according to plan.
He said the central bank would test how these notes perform under India's climate conditions and within the country's currency-handling infrastructure.
The RBI will study the results before deciding whether to expand the programme or make changes to the notes.
What Are Polymer Notes?
Polymer banknotes are made from a flexible synthetic plastic material instead of the cotton-based paper traditionally used for currency.
They look and fold like paper notes but can last two to four times longer. They are also more resistant to water, dirt and damage. Such notes can include transparent windows and advanced security features, making counterfeiting more difficult.
Used Across Countries
Australia introduced polymer currency notes in 1988 and was the first country to do so. New Zealand later adopted them, while Romania became the first European country to introduce such notes.
Canada, China, Russia, Saudi Arabia, Kuwait and Taiwan are among other countries that use, or have previously used, polymer currency notes.
