Fake notes on the rise in India, says RBI
Fake notes are steadily making their presence felt in the Indian monetary system, thanks to the rise in currency circulation. Sachin Kumar reports. Noting the discrepancybusiness Updated: Aug 30, 2011 22:12 IST
Fake notes are steadily making their presence felt in the Indian monetary system, thanks to the rise in currency circulation.
The number of fake notes in India grew by 9% to 435,607 in 2010-11 from 401,476 in 2009-10, according to data by the Reserve Bank of India (RBI). During the same period, total banknotes in circulation grew by 14% to 64,577 million from 56,549.
"Counterfeit banknotes detected during the year were higher in magnitude on account of heightened awareness amongst banks and increased use of note sorting machines," the RBI noted in its annual report.
Around 90% of the counterfeit notes identified were detected at bank branches, reflecting the increased use of note sorting machines. By April end, there were around 4,000 such machines installed.
According to industry watchers, to avoid counterfeits, notes should have strong security features so that it becomes difficult to copy them. "Indian notes do not have enough security features compared to those in developed economies," said Sunil Udupa, CEO, AGS Transact Technologies. AGS has so far installed over 10,000 ATMs for banks across the country. "We also need to increase the number of fake notes detecting machines in India significantly," said Udupa.
"Banks are continuously increasing the number of note sorting machines in branches, which will arrest the rise in circulation of fake notes," said an official of a public sector bank. "The general public should also be aware while using high value notes."