The Reserve Bank of India will test ₹10 and ₹20 polymer banknotes while paper currency continues to remain in circulation.
India has approved the Reserve Bank of India’s (RBI) proposal to begin field trials of ₹10 and ₹20 polymer banknotes, marking a step towards testing a more durable alternative to conventional paper currency.
The Finance Ministry confirmed in Parliament that the pilot programme is intended to evaluate how polymer notes perform under Indian conditions before any decision is taken on wider adoption.
RBI to Test ₹10 and ₹20 Polymer Notes
Minister of State for Finance Pankaj Chaudhary informed the Lok Sabha that the government has cleared the RBI’s proposal to conduct field trials using polymer banknotes in the ₹10 and ₹20 denominations.
As part of the pilot, the RBI plans to issue one billion ₹10 notes and one billion ₹20 notes made from polymer.
The central bank will assess their durability, security features, and overall suitability for everyday use across different regions and climates.
Paper Currency Will Continue
The government clarified that the trial does not signal the withdrawal of existing paper banknotes.
Polymer notes will circulate alongside current paper currency, and there are no plans to replace the existing currency system at this stage.
The RBI will review the results of the pilot before deciding whether polymer banknotes should be introduced more widely.
Why Is RBI Testing Polymer Notes?
Polymer banknotes are designed to last significantly longer than traditional paper notes, particularly in countries where cash is used frequently.
Lower-denomination notes such as ₹10 and ₹20 change hands more often and typically wear out faster, increasing printing and replacement costs.
According to the RBI, longer-lasting polymer notes could reduce these costs while lowering the amount of waste generated from damaged and discarded currency.
Better Protection Against Counterfeiting
Another advantage of polymer currency is enhanced security.
Polymer banknotes can incorporate advanced anti-counterfeiting features, including transparent windows and specialised security elements that are much harder to replicate than those used on conventional paper notes.
These features are intended to strengthen the integrity of India’s currency and make counterfeit notes more difficult to produce.
What Happens Next?
The RBI will monitor the performance of the polymer notes during the field trial, examining factors such as durability, public acceptance, handling, and security.
The findings will determine whether polymer banknotes are suitable for wider circulation in India, while paper currency will continue to be in use throughout the testing phase.
Source: Gulf News
