Currency notes of Rs 2,000 denomination will be withdrawn from circulation, said a Reserve Bank of India circular dated May 19. The notes will continue to be legal tender till September 30, the circular added. Announcing the decision to withdraw Rs 2,000 denomination notes from circulation, the Reserve Bank of India (RBI) has asked banks not to issue such notes with immediate effect.
As per the RBI, the ₹2,000 note will continue to be a legal tender. It means that the people can continue to use them for their transactions and receive them in payment. But they have been encouraged to deposit and/or exchange these currency notes before September 30 this year. The people can exchange ₹2,000 bank notes up to a limit of ₹20,000 at a time. They can also deposit these notes into their account subject to KYC norms. These notes can be exchanged through business correspondents up to a limit of ₹4000/- per day for an account holder.The RBI has urged people to approach the bank branches from May 23 for exchanging their ₹2,000 bank notes. This is being done to give more time to banks to prepare for the bank exchange process. The deposits into accounts can be made without restrictions. The ₹2000 banknotes can be deposited into bank accounts and cash requirements can be drawn thereafter, against these deposits, the RBI said. The exchange facility shall be provided free of cost.