Government approves roll out of polymer banknotes in Rs. 10 and Rs. 20 denominations for field trials

STC NEWS DESK
NEW DELHI, JULY 28 (STC): In a move to mark the first major step towards testing polymer-based currency in India, the Union Government has approved the Reserve Bank of India’s (RBI) proposal to introduce one billion polymer banknotes each in the Rs. 10 and Rs. 20 denominations for field trials.
This was disclosed by Minister of State for Finance Pankaj Chaudhary in the Lok Sabha on Monday.
In a written reply to Parliament, Chaudhary said the RBI had submitted the proposal under Section 25 of the Reserve Bank of India Act, 1934, following the recommendation of its Central Board. The proposal seeks approval for the issuance of one billion polymer notes each in the Rs. 10 and Rs. 20 denominations for pilot circulation, followed by their regular issuance if the field trials are successful. “The proposal has been approved by the government,” the minister said.
Polymer banknotes are made from a special plastic substrate instead of paper and are widely used in several countries, including Australia, Canada, and the UK, due to their longer lifespan and enhanced durability.
According to the RBI, international studies have shown that polymer banknotes last significantly longer than conventional paper currency. Their higher resistance to wear and tear makes them particularly suitable for economies such as India, where cash remains the king despite the rapid growth of digital payment methods.
Notably, as clarified by the minister, polymer banknotes are not intended to replace paper currency. Instead, the RBI plans to issue polymer notes alongside existing paper-substrate banknotes.
The RBI has also maintained that physical currency and digital payment systems are complementary payment instruments rather than competing alternatives.
(Straight Talk Communications)