In a written reply given by Minister of State for Finance, Shri Jayant Sinha in Lok Sabha, it was revealed that the Government is all set to introduce one billion plastic notes of Rs 10 denomination on a trial basis in 5 Indian cities: Kochi, Mysore, Jaipur, Shimla and Bhubaneswar.
Based on the outcome of the trial, more plastic notes would be printed, and distributed all over the country.
This trial run of polymer based plastic notes is being done to check and analyze the climatic and geographical implications on the usage and longevity of the notes.
Advantages of Using Plastic Notes
No more scribbled and soiled notes
As per Government estimates, one out of five currency notes are destroyed every year, which translate into losses worth Rs 2 lakh crore, every 12 months. During 2011-12, 13 billion units of Indian currency were deemed unfit to use, thereby inciting direct losses to the Government.
Scribbling on notes, soiling, humid conditions etc are some of the reasons which destroy currency notes.
Introduction of plastic notes will certainly help in tackling this problem, and increase shelf-life of the currency notes. Already countries like Singapore, Canada, Australia, New Zealand, Malaysia, Vietnam, Fiji, Brunei, Papua New Guinea and Romania have been using plastic notes, and the results are excellent.
Increased Currency Note Lifetime
As per Gerry Wilson of Australia-based Commonwealth Scientific and Industrial Research Organization (CSIRO), plastic notes directly increase the life-time of currency units by 4 times; which means that more than Rs 8 lakh crore can be saved every 4 years, if we implement plastic notes all over.
Additionally, if Indian Government decides to implement plastic notes all over the country, for every denomination, then it will also help us to fight counterfeiting.
As per Ashvin Parekh from Ernst & Young’s Partner & National Leader (Global Financial Services), production of plastic notes is a highly complicated process, and creating fake units would be close to impossible as the notes are already embedded with anti-counterfeiting features.
In countries like Australia and Canada, the menace of counterfeiting has almost ended, solely due to the increased usage of plastic notes.
Polymer based currency notes can be produced at a faster rate. As per some estimations done by Commonwealth Scientific and Industrial Research Organization (CSIRO), plastic notes can be manufactured 10 time faster compared to traditional paper based notes.
Besides, plastic notes are also environmental friendly, and can be recycled easily.
What is your take on these new currency notes?