Soon durable and difficult to counterfeit plastic notes in five cities

The Reserve Bank of India will introduce 1 billion plastic currency notes (notes with plastic substrate) inJaipur, Bhubaneswar, Kochi, Shimla and Mysore, the central bank saidin its annual report for 2012-13.It will initially introduce the polymer Rs 10 denomination notes. This, of course, is to conduct field trials to see how these notes work in diverse geographies and climates.

Long lasting, hygienic: The objective behind the move is to increase the circulation life of banknotes. Plastic notes are expected to last longer–some experts believe as much as four times that of paper notes or up to five years–as they can be recycled. They would be thicker, hard to tear and get soiled less.

[caption id=“attachment_1069255” align=“alignright” width=“380”]  The objective behind the move is to increase the circulation life of banknotes. Reuters[/caption]

India is not the first country to offer plastic notes. Australia has such notes for around 25 years now, the RBI report said. And more than 30 countries have introduced such polymer banknotes, and many countries have actually moved away from paper notes all together. Canada recently launched such notes in various denominations.

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Such notes are also hygienic as they can be cleaned by a damp cloth to remove dirt and spills as they will be water-proof. Paper notes have a few health hazards as micro-organisms easily get settled on them. “Micro organisms were isolated from 100% of the currency notes. Mainly three species were isolated, namely Escherichia coli, Proteus spp. and Staphylococcus aureus,” says a report titledAn Assessment of Oral Health Risk Associated with Handling of Currency Notespublished in the International Journal of Dental Clinics in 2010. The study concluded thatinfected currency was a potential public health hazard, as pathogens could spread by circulating banknotes and recommended caution while handling them.

Doctors concur this view. “The present currency notes can easily have a number of micro-organism on them which could make you fall sick, right for common cold, to influenza to various gastrointestinal infections,” G M Kolge, Mumbai-based medical practitioner,told Firstpost.

In short, plastic notes will surely work well for general public compared with paper notes.

**Cost and counterfeiting:**Polymer notes would work well for the RBI as well. That they are long lasting means they would be cost effective. “They create minimal dust and no fibres during printing and handling; and they can contain certain security features that are difficult and expensive to counterfeit,” the RBI said in its report. As many as 4,98,252 counterfeit notes were detected in 2012-13, the report said. The central bank is struggling hard to curb circulation of fake notes.With additional security features, it hopes counterfeiting of plastic notes will become difficult.

Other benefits:The RBI also claims that such notes have significant environment benefits over the current cotton based paper notes. Polymers are also hazardous to the environment, recycling makes them friendlier to environment than paper notes.

There have been instances when bank ATMs too forked out fake notes. Even in such cases, it is the common man who bear the loss. Let us hope the RBI’s pilot project in five cities will have favourable outcome. Plastic currency will be a win-win situation for common man as well as the regulator.