Saturday, August 19, 2017

New Rs. 50 notes in your wallets soon

Mumbai, August 18:  The Reserve Bank of India on Friday said it will shortly issue Rs. 50 denomination banknotes in the Mahatma Gandhi (New) Series. The base colour of the note is fluorescent blue.

In November 2016, the RBI had introduced new banknotes of Rs. 500 and Rs. 2,000 denominations with base colours of stone grey and magenta, respectively.

The new Rs. 50 banknote has a motif of Hampi with a chariot, depicting the country’s cultural heritage, and the Swachh Bharat logo with slogan on the reverse.

All the banknotes in the denomination of Rs. 50 issued by the Reserve Bank in the earlier series will continue to be legal tender, the central bank said in a statement.

During the demonetisation period (November 9, 2016 to December 30, 2016), currency notes of denominations Rs. 1,000 and Rs. 500 (specified bank notes or SBNs), valued at Rs. 15.4 lakh crore and constituting 86.9 per cent of the value of total notes in circulation, were sucked out of the economy.

According to an RBI study, ‘excess’ bank deposit growth (year-on-year) following demonetisation was in the range of 3.0-4.7 percentage points. In nominal terms, these estimates imply excess deposits that accrued to the banking system due to demonetisation to be in the range of Rs. 2.8-4.3 lakh crore.

The study said a micro-level analysis of unusual growth in cash deposits in specific types of accounts, which are usually marked by low level of activity, also support the findings. Such gains in terms of a shift towards bank deposits, if durable, could have beneficial impact in the form of financialisation of savings.

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