RBI Considers Introduction of Polymer Currency Notes

The Reserve Bank of India is currently evaluating the potential introduction of polymer currency notes, as confirmed by Governor Sanjay Malhotra. This proposal comes in light of the short lifespan of paper currency and rising costs associated with printing. While discussions are ongoing, the RBI assures that there is sufficient currency available in the banking system to meet demand. The central bank is prepared to address any localized shortages swiftly. With significant numbers of damaged notes being withdrawn each year, the move towards polymer notes could enhance the durability of currency in India. Stay tuned for updates on this developing story.

By Narendra Chaudhary Jun 6, 2026, 17:17 IST

RBI's Exploration of Polymer Notes

A file image of RBI Governor Sanjay Malhotra (Photo: IANS)

New Delhi, June 6: The Reserve Bank of India (RBI) is currently reviewing a proposal to potentially implement polymer or plastic currency notes, as stated by Governor Sanjay Malhotra on Saturday.

Malhotra mentioned that the discussion around polymer notes is ongoing, and he assured that any decision made will be communicated promptly.

He acknowledged that while there is some validity to recent reports about polymer notes, the central bank has yet to finalize any conclusions.

“We are assessing the advantages and disadvantages of this option to determine its feasibility. The process is still in its early stages,” he explained.

Furthermore, the RBI Governor confirmed that there is sufficient currency available within the banking system and that the central bank is ready to act swiftly in case of localized shortages.

“If any shortages occur, we will ensure they are addressed,” he stated.

Emphasizing the availability of currency for ATMs and bank branches, Malhotra assured that the RBI would facilitate quick replenishment as needed.

“Our commitment is to ensure that any currency shortages at ATMs or branches are resolved promptly and efficiently,” he added.

A significant reason behind the proposal is the relatively brief lifespan of paper currency in India. Frequent handling, circulation, and varying weather conditions often lead to rapid deterioration of banknotes.

According to RBI statistics, approximately two lakh damaged currency notes are removed from circulation and destroyed annually. Notably, higher-denomination notes, especially Rs 100 and Rs 500, represent a large portion of the damaged currency taken out of circulation.

The expenses associated with printing currency have also escalated. The RBI's recent annual report indicates that the cost of printing banknotes rose to Rs 6,372.8 crore in FY25, up from Rs 5,101.4 crore in FY24, primarily due to the increasing demand for currency notes.