No need to rush to banks as there’s 4 months time says RBI governor on pulling ₹2,000 notes off circulation

• There is no reason to rush to banks, there is time for four months, Das said on Monday.
• Will be sensitive to the difficulties faced by people and it’s our endeavour to address the difficulties of people, Das said.
• A PIL has been filed in the Delhi HC against RBI and SBI notifications that permit the exchange of ₹2,000 banknotes without obtaining ID proof.

The Reserve Bank of India (RBI) governor Shaktikanta Das on Monday allayed fears regarding the central bank’s decision to pull ₹2,000 banknotes out of circulation. Calling its decision, announced on late Friday, a currency management operation of the RBI, Das said he does not see people rushing to banks to exchange or deposit these notes.

“There is no reason to rush to banks. There is time for four months," Das said, speaking in New Delhi.

On Friday, RBI said in a statement that ₹2,000 banknotes will continue to be legal tender. People possessing these notes can deposit them in their bank accounts or get them exchanged from May 23 to September 30, the central bank had said.

In its statement, the RBI also advised banks to stop issuing ₹2,000-denomination banknotes with immediate effect. About 89% of the ₹2,000-denomination banknotes were issued prior to March 2017 and are at the end of their estimated life-span of 4-5 years.

Das also said that the RBI had stopped printing these denominations. Regarding a possible extension to the September 30 deadline, he said that the central bank will take a call after assessing how much of these banknotes come back to the banks.

"We assure people who are abroad and within India, we will be sensitive to the difficulties you may face. It will be our endeavour to address the difficulties of people," Das said.

The total value of these banknotes in circulation has declined from ₹6.73 lakh crore at its peak as on March 31, 2018 (37.3% of notes in circulation) to ₹3.62 lakh crore, constituting only 10.8% of notes in circulation as on March 31, 2023.

“It has also been observed that this denomination is not commonly used for transactions. Further, the stock of banknotes in other denominations continues to be adequate to meet the currency requirement of the public. In view of the above, and in pursuance of the ‘Clean Note Policy’ of the RBI, it has been decided to withdraw the ₹2,000 denomination banknotes from circulation,” RBI said in its statement.

In the meanwhile, a public interest litigation has been filed in the Delhi High Court against RBI and State Bank of India notifications that permit the exchange of ₹2,000 banknotes without obtaining identity proof.