Lok Sabha Question No. 2728 (UNSTARRED), answered on 2017-03-17
Subject: Polymer Notes
Ministry: FINANCE
Asked by: PRATHAP SIMHA, SHOBHA KARANDLAJE

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMIC AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO.2728

## TO BE ANSWERED ON 17 th  MARCH 2017/26 TH  PHALGUNA SAKA, 1938

## POLYMER NOTES

## 2728.  SHRI PRATHAP SIMHA: KUMARI SHOBHA KARANDLAJE:

## QUESTION

## Will the Minister of FINANCE be pleased to state:

- (a) whether  the  Government  proposes  to  introduce  polymer  notes  of  various denomination and if so, the details thereof and if not, the reasons therefor;
- (b) whether the plastic notes have an average life span of about five years and are difficult to imitate/ counterfeit and if so, the details thereof;
- (c) whether RBI has issued guidelines to focus on the need to discourage people from inscription, scrawling or scribbling on any part of the notes and if so, the details thereof;
- (d) whether RBI/Government has set up any panel/committee to review the threats inherent in the existing or emerging technology in the banking transactions and if so, the details thereof; and
- (e) whether  the  Government/RBI  has  formulated  any  policy  to  strengthen  cyber security and resilience of banks in this regard and if so, the details thereof?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY FOR FINANCE (SHRI ARJUN RAM MEGHWAL)

- (a) It has been decided to conduct a field trial with plastic banknotes at five locations of the country.  Approval for procurement of plastic substrate and printing of bank notes of Rs.10 denomination on plastic banknote substrates has been conveyed to RBI.
- (b) Plastic banknotes are expected to last longer than cotton substrate based banknotes. Over the years, central banks across the world have been exploring different solutions for extending the lifecycle of banknotes.  These include introduction of plastic banknotes and

other  developments  in  banknote  substrates  for  enhancing  durability  including  use  of natural fibre blends, varnish of banknotes etc.

(c) The following  actions have been taken by RBI

- i. Vide its Directive dated November 07, 2001 under Section 35 ( A) of B. R. Act, 1935 advised all banks not to write anything on watermark window of banknotes.
- ii. RBI  has  also  issued  a  Press  Release  on  December  31,  2013  on  'RBI's clarification on scribbling on Banknotes'.
- iii. RBI has advised all the bank branches to display at their branch premises at prominent place, a board indicating the availability of notes exchange facility for information of general public.
- iv. RBI from time to time issues instructions to banks to organize exchange melas to mop up soiled and mutilated banknotes from circulation.
- v. RBI periodically issues Press Releases appealing to the members of public not to inscribe anything on banknotes as it damages the notes and poses difficulty in identifying the features of genuine banknotes.

(d) & (e) An inter-disciplinary Standing Committee on Cyber Security has been constituted to  review  the  threats  inherent  in  the  existing/  emerging  technology  and  suggest appropriate policy interventions to strengthen cyber security and resilience.

----------