5 Years On Since Demonetization, Here's What Happened To The Old 500 & 1000 Rupee Notes
Who can forget the night of 8th November 2016, when the Prime Minister of India Narendra Modi demonetized all ?500 and ?1000 notes. But even after more than 5 years since demonetization, one question which remains unanswered for many, is that what happened to those old notes? Read on as we unfold the same for you.
Who can forget the night of 8th November 2016, when PM Narendra Modi demonetized all ?500 and ?1000 notes. In 2018, the RBI had stated that 99.3% of the old notes have been returned to the banking system.
Today, more than five years since that huge announcement, when crores lined up outside banks to return the banned notes and get new ones, one question which remains unanswered is what happened to those old notes?
What did the central bank RBI or government do with the old notes? Did they recycle them or something else?
shutterstock
Also Read: Here's A List Of Countries That Have Tried Demonetisation Before India
Curious to know? Let's find the answer:
What Happened To Demonetized Notes
As per previous statements by RBI officials, the demonetized currency collected from the banks is processed through a currency verification and processing system which has the ability to differentiate between real and fake notes.
The demonetized notes are then shredded and converted into briquettes, which are blocks of compressed waste. After converting it into briquettes, tenders are invited. And then those briquettes are sold to cardboard and paper manufacturers.
In short, the old banned notes that the RBI received, get shredded and converted into blocks of composite waste, and then sold to cardboard and paper manufacturers as per tenders.
shutterstock
99.3% Old Notes Returned
As of November 8, 2016, i.e. the day of demonetization announcement, there were 1,716.5 crore pieces of ? 500 and 685.8 crore pieces of ? 1,000 notes in circulation, which totalled to this massive amount of ? 15.44 lakh crore, as per RBI.
In its annual report for 2016-17 which was released on August 30th 2017, the RBI had said ? 15.28 lakh crore, or close to 99.3% of the demonetized notes, had returned to the banking system.
RBI further stated that for the year ended June 30, 2017, only ? 16,050 crore of the ? 15.44 lakh crore held in old demonetized notes had not been returned.
However, even after over five years since this huge move of demonetization, the question that remains unanswered, is whether demonetization was able to achieve its aim, i.e. to grab hold of black money.
shutterstock
Also Read: RBI Creates New Fintech Department, May Take Up Crypto Issues
For more of such interesting content and the latest financial news, keep reading Worth. Click here.
