Centre Approves RBI Proposal to Introduce Polymer Currency Notes in India

The Central Government has approved a proposal by the Reserve Bank of India (RBI) to introduce polymer (plastic) currency notes in the country. As part of the pilot phase, ₹10 and ₹20 polymer notes will be printed and released for circulation on a trial basis.

According to Minister of State for Finance Pankaj Chaudhary, up to 100 crore ₹10 notes and 100 crore ₹20 notes will be printed under the pilot programme. If the trial proves successful, polymer banknotes could be introduced for wider circulation across the country.

The government has clarified that the introduction of polymer notes will not make existing paper currency invalid. Both paper and polymer notes will circulate simultaneously, and there are currently no plans to withdraw paper currency from circulation.

Advantages of Polymer Notes

Polymer banknotes offer several benefits over conventional paper currency:

Longer lifespan, making them more durable than paper notes.
Water-resistant, tear-resistant and less prone to wear and dirt.
Enhanced security features, making them significantly more difficult to counterfeit.

The RBI has been exploring polymer currency primarily because lower denomination notes such as ₹10 and ₹20 change hands frequently, causing them to wear out much faster than higher-value notes. Replacing damaged paper notes regularly increases printing and replacement costs.

Several countries, including Australia, the United Kingdom and Canada, have already adopted polymer currency successfully due to its durability and improved security features. India is now moving towards testing the technology before considering a wider rollout.