RBI selling banned notes to cardboard-making units

Vijay C Roy

Tribune News Service

Chandigarh, September 11

Any guesses what the RBI will do with banned notes of Rs 500 and Rs 1,000. The central bank is selling these notes to cardboard and paper manufacturers. Earlier, the RBI used to burn old and soiled notes. 

The demonetised currency totalling Rs 15.44 lakh crore constituted 86% of India’s currency in value terms. Of this, Rs 500 notes constituted almost 45% of the currency in circulation while 39% of the notes were of Rs 1,000 denomination. The weight of the entire demonetised currency would be around 27,600 tonnes.

“We keep on destroying the soiled and mutilated currency. Though this time the quantum is huge, still whole demonetised currency will be disposed of in an environment- friendly manner,” said a senior RBI official.

Commenting on the procedure followed, he said, “The demonetised currency collected from the banks is processed through currency verification and processing system which has an ability to differentiate between real and fake notes. The notes are then shredded and converted into briquettes which are block of compressed waste. After converting it into briquettes, tenders are invited. We are selling those briquettes to cardboard and paper manufacturers.”