This is What RBI Does After Collecting Rs 500 And 1000 Currency Notes Across The Country
After PM Narendra Modi’s decision of scrapping 500 and 1000 rupee notes to eradicate black money has been effective from the midnight of 8th November 2016, all the people are running towards Banks to deposit their Rs. 500 and 1,000 currency notes.
Do you think what government will do with old 500 and 1000 currency notes ? Recently RBI official in a statement said that they are prepared to dispose of the currency notes and which will be done according to the established rules for disposal of soiled notes.
What will they do after collecting these notes in banks ?
The Reserve Bank Of India says that about 86% of the money in circulation, as on March 31, was in the form of Rs 500 and Rs 1000 currency notes. The spokesperson from RBI said: “The process we will follow for the disposal of damaged or soiled notes. These notes will be deposited at the Issue offices of the Reserve Bank. Then the notes examined, sorted and the unfit among them disposed of under the currency verification and processing system (CVPS). We will have to examine these notes to ensure they are not fake too,”.
Currency Verification and Processing System (CVPS)
In 2003, the then RBI governor, Bimal Jalan, inaugurated the Currency Verification and Processing System (CVPS) in Mumbai Office of the Reserve Bank of India. The currency verification and processing systems were installed for faster and secure processing of soiled currency notes.
How Rs 500 and Rs 1000 notes will be disposed of ?
During the CVPS process, the shredded notes are converted into briquettes weighing about 100 grams. The shredded notes will be converted into briquettes weighing about 100 grams. Under the current practice, the briquettes are sold for industrial use through a tender invited by the RBI. The shredded currency is also recycled into various products including paperweights, calendars, and files.
“The system is also environment-friendly, as it does not create pollution that was created by burning of notes in the past. The briquettes can be used as residual fuel in industrial furnaces. They can even be used for land fillings or for making items for use at the office and home and paperboard,” says the spokesperson.
Rest in peace Rs 500 and Rs 1000 notes.