New Rs 100 notes coming next year, printing to begin in April
RBI officials old notes will continue to be valid and will gradually be replaced without disrupting cash flow
The Reserve Bank of India (RBI) is expected to start printing redesigned Rs 100 currency notes around April next year, sources in the central bank have said.
Printing for the new notes, one of the most common denominations in the country, will begin after presses finish printing the new Rs 200 bank note by the end of the financial year in March.
The existing Rs 100 currency notes will continue to be in the system and will be withdrawn gradually without any disruption, the central bank official said, asking to remain unnamed.
The size and dimensions of the new notes will not be altered, ensuring automatic-teller machines (ATMs) can be compatible from the beginning. Currently, Rs 100 is dispensed through ATMs across the country. Of the four cassettes, or boxes, in an ATM, only one is used for Rs 100 notes.
Countries often redesign bank notes to eliminate chances of hoarding in order to catch tax dodgers. India banned the old Rs 500- and Rs 1,000-denomination bank notes in November last year in an ambitious attempt to flush out undeclared wealth. The two bank notes together accounted for 86% of the currency in circulation at the time.
In December, RBI officials had said that all currency notes will be redesigned.
Since then, the government has changed the Rs 500 and Rs 50 notes, and introduced new denominations of Rs 200 and Rs 2,000.
Sources added the exercise of pumping the Rs 200 notes into the system is likely to take around another six months. Their printing will depend on the demand and feedback received from the select bank branches that have started dispensing the new denomination.
The government introduced the Rs 200 notes to help people change high-value currency notes. According to a State Bank of India report, 43.6% of the total cash circulation is in Rs 500 notes while Rs 100 is just over 20%.
Bank officials said that while the currency replacement exercise is over and there is no shortage of cash, people are not keen on withdrawing the Rs 2,000 bank notes.