RBI Consolidates Directions on Withdrawal of Pre-2005 Banknotes
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- 2 Min Read
- By Taxmann
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- Last Updated on 11 June, 2026
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The Reserve Bank of India (RBI) has issued a consolidated circular compiling all existing instructions relating to the withdrawal and exchange of ₹2,000 denomination banknotes under its Clean Note Policy.
1. Background
The ₹2,000 banknote was introduced in November 2016 under Section 24(1) of the RBI Act, 1934. Subsequently, on 19 May 2023, the RBI announced the withdrawal of ₹2,000 notes from circulation as part of its Clean Note Policy aimed at improving the quality of currency in circulation.
2. Exchange and Deposit Facility
To facilitate the withdrawal process, the RBI permitted the public to deposit or exchange ₹2,000 banknotes at all bank branches across India up to 07 October 2023. Thereafter, the facility at bank branches was discontinued.
From 09 October 2023, holders of ₹2,000 banknotes have been allowed to exchange or deposit them at any of the 19 designated RBI Issue Offices across the country. This facility remains available until further instructions from the RBI.
3. ₹2,000 Notes Continue as Legal Tender
The RBI has reiterated that the withdrawal of ₹2,000 banknotes from circulation does not affect their legal status. Accordingly, ₹2,000 banknotes continue to remain legal tender and may still be used for making payments and settling transactions.
4. Nature of the Circular
The circular dated 09 June 2026 does not introduce any new policy measures. It merely consolidates the various circulars and instructions issued since the announcement of the withdrawal of ₹2,000 banknotes, providing a single reference document for banks and other stakeholders.
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