Mega Drive To Replace Rs 2000 Notes With Rs 500 Notes In ATMs: You Will No Longer Find Rs 2000 Notes!
As per the reports, the Rs 2,000 notes may reportedly be taken out of circulation and efforts are underway to recalibrate over 240,000 automated teller machines (ATMs) to replace the currency note with those of Rs 500 denomination.
How Did This Happen?
Basically, banks are recalibrating ATMs to replace high-value Rs 2,000 notes with Rs 500 notes.
Although there is no official confirmation from the Reserve Bank of India (RBI) or other authorities, it is assumed that this could be part of the strategy of the central bank to keep a tab on the total amount of high-value currency in circulation.
According to the sources, the largest denomination currency will remain legal tender, but would be gradually phased out of public circulation, told the paper.
How Will It Work?
Basically, ATMs have four cassettes (slots) for notes, each fitted for a particular denomination say Rs 100, Rs 200, Rs 500 and Rs 2,000, carrying 2,300-2,600 pieces.
The recalibration exercise would mainly entail the exchange of the Rs 2,000 cassette with Rs 500 ones.
According to the report, Instead banks are stashing the Rs 2,000 notes in their currency chests – which go into the Reserve Bank of India’s (RBI) vaults.
So out of the four cassettes within ATMs, three will have Rs 500 notes, and the fourth will be filled with Rs 100 or Rs 200 notes.
The process is supposed to be completed within a year.
‘Till boxes are being slowly rebooted’, customers need not panic as the notes will continue to be legal tender, Sources informed.
Why Would This Happen?
This move of removing Rs 2000 note from ATMs is supposed to benefit banks and white-label ATM (WLA) deployers as they earn Rs 15 per swipe and lower denominations would mean increased transactions for withdrawal of larger sums.
WLA basically allows private non-bank companies to institute and operate their own brand of ATMs in the country.
Indian Bank had said last week that it will no longer keep Rs 2,000 notes in its ATMs, citing public inconvenience, who found it hard to exchange the notes.
While the decision will come into effect on March 1, till then the bank’s branches will continue to offer Rs 2000 notes.
But lower denominations would also mean that banks would have to undertake more cash van trips to load ATMs and swipe pulls above Rs 10,000 are few.