People rush to petrol pumps to exchange currency after RBI announces scrapping of Rs 2000 notes

With the Reserve Bank of India announcing to withdraw Rs 2,000 banknotes from circulation, markets and petrol pumps across the country are witnessing a huge rush of people trying to spend the currency.

The RBI last week announced the withdrawal of Rs 2,000 currency notes from circulation but gave the public time till September 30 to either deposit such notes in accounts or exchange them at banks.

Unlike the November 2016 shock demonetisation when old Rs 500 and Rs 1,000 notes were invalidated overnight, the Rs 2,000 notes will continue to be legal tender till September 30.

Rakesh Gupta, an owner of a supermarket in Noida said that most of the customers are coming with Rs 2000 notes to buy household goods. “We are accepting such notes but on condition that customers will have to buy supplies for the full amount as it is difficult for us to give every customer the remaining amount back,” he said.

However, some of the customers complained that patrol pumps refused to accept Rs 2000 notes even after RBI clarified that such currency notes continue to be legal tender.

@DirMktg_iocl @DirMktg_iocl @IOCRetail @FinMinIndia @RBI @nsitharaman @PMOIndia This sign at an Indian Oil Petrol Pump says all about how and panic can be created with wrong understanding of simple withdrawal process for ₹2000 currency. Pl take care and inform your pumps. pic.twitter.com/Fe6DPWMVVr

— nipunsheth (@nipunsheth2) May 21, 2023

Dilip Jain, a twitter user tweeted “Today went to petrol pump in mumbai he said owner given instructions not to accept 2000 note . If this is legal tender then how the pump says not accept .after argument I have paid by credit card,”.

Today went to petrol pump in mumbai he said owner given instructions not to accept 2000 note . If this is legal tender then how the pump says not accept .after argument I have paid by credit card @CNBC_Awaaz @RBI @amitgupta0310 @RoyLakshman @MumbaiPolice pic.twitter.com/3mszy0h1da

— DILIP JAIN (@DilipPichholiya) May 20, 2023

Meanwhile, Reserve Bank of India (RBI) Governor Shaktikanta Das on Monday said most of the withdrawn Rs 2,000 rupee notes are expected to be returned by the deadline of September 30.

Speaking to reporters for the first time since the surprise decision to withdraw the highest denomination currency note was announced, Das said the decision was part of currency management.

The move to withdraw Rs 2000 banknotes comes amid concerns of the highest denomination notes being used to hoard black money. The RBI had stopped printing Rs 2,000 notes in 2018-19 and the notes were rarely in circulation.

The Rs 2,000 denomination bank note was introduced in November 2016, primarily to meet the currency requirement of the economy in an expeditious manner after the withdrawal of legal tender status of all Rs 500 and Rs 1,000 bank notes in circulation at that time.

The RBI had said that it has also been observed that Rs 2,000 denomination note is not commonly used for transactions. Further, the stock of bank notes in other denominations continues to be adequate to meet the currency requirement of the public, it added.

“In view of the above, and in pursuance of the ‘Clean Note Policy’ of the Reserve Bank of India, it has been decided to withdraw the Rs 2,000 denomination bank notes from circulation,” the RBI said. The bank notes in Rs 2,000 denomination will continue to be a legal tender, it added.

The central bank has asked the public to deposit Rs 2,000 bank notes into their bank accounts and/or exchange them into banknotes of other denominations at any bank branch.

“Members of the public are encouraged to utilise the time up to September 30, 2023 to deposit and/or exchange the Rs 2,000 bank notes,” the central bank said.

In January 2014, the RBI announced the withdrawal from circulation of all bank notes issued prior to 2005.

(With agency inputs)

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