SENSEX NIFTY
May 09, 2013, 11.54 AM IST | Source: PTI

RBI to launch plastic currency notes with longer shelf-life

Srinagar: Reserve Bank Governor D Subbarao on Wednesday said the central bank will soon introduce on a pilot basis plastic currency notes as they have longer shelf-life.

Reserve Bank Governor D Subbarao on Wednesday said the central bank will soon introduce on a pilot basis plastic currency notes as they have longer shelf-life.

"We are trying to introduce plastic currency...We hope to introduce it on trial basis and if that succeeds it will be replicated in the entire country," he said during an interactive session with students of Business School of Kashmir University in Srinagar.

Also read: RBI listens to 'silent voices' hurt by inflation: Subbaraoa

He emphasised that plastic note is environment friendly because it has longer shelf-life than the paper notes. Australia and Singapore have introduced plastic currencies. With a view to elongating life of bank notes, particularly of lower denominations, it was decided by the RBI and government to introduce one billion pieces of Rs 10 notes in polymer/plastic on a trial basis in Kochi, Mysore, Jaipur, Bhubaneswar and Shimla. The Finance Ministry had recently said that the review of policy of producing currency notes is a "dynamic and continuous process".

On the issue of fake currency, Subbarao said the problem is that whenever a fake currency is detected both the customer and the bank would be reluctant to put it on record. "You want to get away because you don't want to get entangle with the police and bank want to get away because it means a lot of work for them. So, within the system there is disincentive for detecting fake currency," he said. As the current norms are too draconian, he said, the RBI has convinced the Ministry of Home Affairs that FIRs should be filed only if the more than four fake notes are found with a person.

Must read: Checking money laundering Govts responsibility: Subbarao

ADS BY GOOGLE

video of the day

India inflation to drop at startling levels in 2015: Walker

Explore Moneycontrol

Copyright © e-Eighteen.com Ltd. All rights reserved. Reproduction of news articles, photos, videos or any other content in whole or in part in any form or medium without express written permission of moneycontrol.com is prohibited.