July 28
New Delhi: In a significant step towards modernising India’s currency system, the Centre has approved the Reserve Bank of India’s (RBI) proposal to introduce polymer (plastic) banknotes in ₹10 and ₹20 denominations. The approval paves the way for field trials of one billion notes each of both denominations before any wider rollout.
Minister of State for Finance Pankaj Chaudhary informed the Lok Sabha that the RBI had sought the government’s approval under the Reserve Bank of India Act to conduct large-scale field trials. Based on the outcome of these trials, the central bank will decide on the future issuance of polymer notes.
Polymer banknotes are considered more durable than conventional paper currency, making them resistant to wear and tear, moisture and dirt. They also incorporate advanced security features that make counterfeiting more difficult while reducing replacement costs over time. Several countries, including Australia, Canada and the United Kingdom, already use polymer currency.
The government has, however, clarified that this is only a pilot initiative and there is no plan at present to replace all existing paper currency with polymer notes. Current ₹10 and ₹20 paper notes will continue to remain legal tender and circulate alongside the trial notes.
