RBI Notifications on the Demonetisation of Rs 500 and Rs 1,000 Notes

A look at the key notifications issued by the Reserve Bank of India on the scrapping of Rs 1,000 and Rs 500 currency notes:

Non-dispensing of Old High Denomination Notes at ATMs

The Government of India has withdrawn from immediate effect (midnight of November 8, 2016) the legal tender character of the existing and any older series banknotes in the denominations of Rs 500 and Rs 1000. As such, dispensing of these Old High Denomination (OHD) banknotes by banks through their ATMs has to be stopped from midnight of November 8, 2016.

In order to facilitate the banks to prepare themselves for the same, all Public sector /Private sector/Foreign banks, RRBs, Urban Co-op banks and State Co-op banks have already been advised to remain closed for public transactions on November 09, 2016.

In view of the above, it has been decided that all ATMs will remain closed for operations from the mid night of Nov 08, 2016 so that they do not dispense the withdrawn old higher denomination banknotes (OHD). The ATMs may resume functioning from November 11, 2016 upon their recalibration to dispense bank notes of only Rs 50 and Rs 100 denominations.

Banks and ATM switches may take necessary steps to initiate this measure with immediate effect for both on-us and off-us transactions.

Further, so as to ensure customer convenience, banks are also advised to provide all cash withdrawal transactions at their ATMs free of cost to their customers till 30 Dec 2016. It has also been decided that banks may fix a limit of ₹ 2000/- per day per card withdrawal limit at ATMs, for all their customers, till November 18, 2016.

This directive is issued under section 10(2) read with section 18 of the Payment and Settlement Systems Act 2007 (Act 51 of 2007).

Issue of Rs 2,000 banknotes with inset letter ‘R’

The Reserve Bank of India will shortly issue Rs 2000 denomination banknotes in the Mahatma Gandhi (New) Series, with the inset letter ‘R’, bearing signature of Dr. Urjit R. Patel, Governor, Reserve Bank of India, and the year of printing '2016' printed on the reverse of the banknote.

The design of these notes to be issued now is similar in all respects to the Rs 2000 banknotes in Mahatma Gandhi (New) Series which was notified through Press Release No. 1144.

The banknotes issued earlier vide Press Release No. 1144. will continue to be legal tender.