Data from at least three banks shows that a significant portion of the Rs 2,000 note in corporate deposits and exchanges comes from companies, not retail customers.
The Reserve Bank of India (RBI) said on August 1 that the Rs 2,000 banknote worth Rs 3.14 lakh, equivalent to 88% in circulation, has returned to the banking system since January 31. 7.
The RBI has also introduced ICRR (Increased Cash Reserve Ratio) to clear up excess liquidity in the banking system, following the withdrawal of Rs 2,000 bills.
RBI announced the withdrawal of Rs 2,000 notes on May 19, 2023, as part of its clean money policy.
How much did the banks get? Public sector lender India Overseas Bank (IOB) received Rs 2,000 worth of Rs 3,589 crore through deposits and swaps.
Ajay Srivastava, MD and CEO of IOB said: “We are 40% of the business and mostly small merchants. Similarly, another public sector bank, UCO Bank, received a Rs 2,000 note worth Rs 3,471 crore as deposit and exchange.
“We received 42% of the Rs 2,000 crore from individuals and 58% from corporations. In total, we received Rs 471 crore on exchange and Rs 3,000 crore on deposits,” said Ashwani Kumar, CEO cum CEO said. (CEO and CEO), UCO Bank. Similarly, City Union Bank received Rs 380 crore. A senior bank official, speaking on condition of anonymity, said the bank had received about 90% of the Rs 2,000 note from companies.
A senior official at another public sector bank, who did not wish to be named, also said most of the deposits come from businesses, while individuals trade more.
“These banknotes (Rs 2,000) are mainly from companies and individuals, not many bills. This is why companies tend to deposit more Rs 2,000 bills in the bank, ”said the PSB leader. total score
On August 1, 2023, the RBI said the Rs 2,000 banknote worth Rs 3.14 lakh crore, or 88% in circulation, had returned to the banking system as of July 31. , the Rs 2,000 denomination note in circulation, as of the closing date of July 31, was still at Rs 0.42 lakh, the RBI said in a press release.
Of the total banknotes recovered from circulation, 87% were in the form of deposits while the remaining 13% were exchanged for other denominations, the statement added.
India’s largest lender, State Bank of India, received a Rs 2,000 note worth Rs 14,000 in deposit.
So far, Baroda Bank (BoB) has received the Rs 2,000 note worth Rs 10,000 crore in the form of deposit or exchange. Bank of India has received the amount of Rs 7,000 crore till 26 July 2023. Shanti Lal Jain, MD and CEO of Bank of India told Moneycontrol in an interview on 28 July.
Private sector lender Kotak Mahindra Bank has received Rs 6,300 crore in a Rs 2,000 note until June 15. South India Bank received the Rs 2,000 note worth Rs 888 crore until June 13, with most of the withdrawals deposited into their accounts by individuals.
Withdrawal of Rs 2,000 banknotes
The RBI, on 19 May 2023, announced the withdrawal of the Rs 2,000 note as part of its clean money policy. In order for the exchange or deposit to be completed smoothly, RBI has given all banks until 30 September 2023. RBI has also advised banks to stop issuing Rs 2,000 denomination notes with effect right away. As the target has been met and smaller denominations are available in sufficient quantities, printing of Rs 2,000 banknotes has been halted for 2018-2019.
According to RBI data, the total value of the Rs 2,000 note in circulation is Rs 3,62 lakh, or 10.8% of the total number of banknotes in circulation as of March 31, 2023.
“It has also been found that this denomination (Rs 2,000 note) is not commonly used for transactions. Furthermore, the amount of banknotes of other denominations continues to be sufficient to meet the monetary needs of the public,” the RBI said in a statement.
The 2,000 rupee note was introduced in November 2016 to meet the foreign exchange requirements after the monetization of 500 rupees and 1,000 rupees. The RBI said on August 10 that banks must maintain an ICRR of 10% from August 12 as part of the central bank’s effort to remove excess liquidity from the banking system, following the withdrawal of the 2000 note. rupees.
ICRR is a temporary measure used when there is a sudden increase in deposits to withdraw liquidity.
