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RBI Prepares for Polymer Banknotes: Longer Life, More Capacity
5 Aug
Summary
- RBI plans to introduce polymer banknotes starting fiscal year 2028.
- Polymer notes are expected to last significantly longer than paper ones.
- New polymer notes will circulate alongside existing paper currency.
The Reserve Bank of India (RBI) is set to introduce polymer banknotes into circulation, targeting the beginning of the next financial year (FY28). This move follows successful field trials and operational assessments. Governor Sanjay Malhotra indicated that the central bank has initiated the tendering process for polymer substrate procurement.
Polymer notes are being introduced to offer a significantly longer lifespan compared to paper currency, particularly for high-circulation, low-denomination notes. They are expected to last three to four times longer, reducing replacement costs. This initiative will also expand the RBI's currency printing capacity to meet the economy's growing cash requirements.
The government has approved the RBI's proposal to issue one billion pieces each of ₹10 and ₹20 polymer notes for field trials. If successful, these will circulate alongside existing paper banknotes, with no plan for a complete replacement of paper currency. Details on advanced security features will be disclosed later.
