Can you use Rs 2,000 notes after September 30?
If you're holding Rs 2,000 currency notes, you might be wondering about their status after September 30, which is the last day for deposits or exchanges at banks.
Considering that banks are closed on September 28 due to a holiday, there is hardly any time left to return Rs 2,000 notes. While there's no official word on a deadline extension, the majority of Rs 2,000 notes in circulation have already found their way back to banks.
As of September 1, the RBI reported, "The total value of Rs 2,000 banknotes received back from circulation is Rs 3.32 lakh crore up to August 31, 2023."
Moreover, as of August 31, 2023, only Rs 0.24 lakh crore worth of Rs 2,000 banknotes were in circulation.
This means that 93 per cent of the Rs 2,000 notes that were circulating as of May 19, 2023, have already been returned through exchanges or account deposits.
It's likely that more deposits have been made in September, further reducing the amount in circulation. On October 1, the RBI is expected to provide an update, which may clarify the fate of the remaining Rs 2,000 notes still in circulation.
While the RBI hasn't explicitly declared these notes invalid after the deadline, it's clear that the central bank intends to phase them out as part of its 'clean note policy.'
The RBI indicated that the future status of Rs 2,000 notes would depend on the quantity returned or deposited in banks.
With over 90 per cent of these notes already returned, there's a high likelihood that the RBI may announce a date when these high-value notes will no longer be considered legal tender.
In simple terms, the notes may not lose their value immediately, but an official announcement from the RBI is awaited.
So, what's the process for depositing or exchanging Rs 2,000 notes? Returning them is straightforward.
The RBI allows individuals to deposit these notes at their respective banks without a specific limit, although regular Know Your Customer (KYC) requirements and other legal deposit regulations still apply.
For those using Basic Savings Bank Deposit (BSBD) or Jan Dhan accounts, the usual deposit limits apply. If you wish to deposit a substantial amount of Rs 2,000 notes into these accounts, you must adhere to the prescribed limits.
Additionally, Rule 114B of the Income Tax Rules mandates individuals to provide their Permanent Account Number (PAN) when making cash deposits exceeding Rs 50,000 in a single day at a bank or post office.
Until September 30, you can also exchange Rs 2,000 notes at 19 Regional Offices (ROs) of the RBI or any nearby bank branch. The RBI's guidelines indicate that these exchanges should be carried out without the need for a request slip or ID proof.
However, some public sector banks may have different procedures in place, so it's advisable to have an ID proof handy when exchanging these notes for a hassle-free experience.