When will plastic notes arrive? Will they initially be introduced for a pilot test? What RBI Governor Sanjay Malhotra told?
Mumbai: If everything goes according to plan, plastic notes will be in the hands of the public by the beginning of the next financial year (April-May 2027).
Reserve Bank of India (RBI) Governor Sanjay Malhotra stated on Wednesday that these notes would initially be introduced for a pilot test. If the pilot proves successful, the initiative will be expanded further.
Responding to a question at a press conference held after the release of the central bank's monetary policy statement, Malhotra said, "If everything goes according to plan, we aim to introduce them by the start of the next financial year."
He explained that tenders for the polymer substrate have currently been invited. Once received, the material will undergo testing and security clearances; there are multiple stages and various security features involved. He added that the public would be informed at the appropriate time.
The RBI Governor said that during the pilot phase, it would be necessary to observe how the notes perform under Indian conditions—specifically regarding the local climate and the supporting infrastructure developed for them. Subsequently, the RBI will consider whether to adopt them fully and if any modifications are required.
He outlined two objectives for introducing polymer notes. First, they extend the lifespan of the currency. This is particularly relevant for low-denomination notes, which change hands frequently and deteriorate quickly. Many countries have been using these notes for 30 years, and it has been observed that they last three to four times longer than paper notes. Additionally, this enhances the RBI's capacity; increasing capacity is essential as the economy grows.
It is noteworthy that the government has granted permission to the Reserve Bank to introduce plastic notes in denominations of Rs 10 and Rs 20. Currently, approval has been received to print two billion plastic notes for the pilot test.