The Reserve Bank of India (RBI) is considering the introduction of polymer currency notes, Governor Sanjay Malhotra announced on Friday. The proposal is currently at a preliminary stage and is being evaluated by the central bank.
The move revives a plan that was first proposed nearly a decade ago as the RBI explored alternatives to traditional paper currency. Polymer notes, often referred to as plastic currency, are known for being more durable and longer-lasting than paper notes. They are also believed to reduce replacement costs over time due to their greater resistance to wear and tear.
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In 2014, the government informed Parliament that one billion polymer notes of Rs 10 denomination would be introduced on a trial basis across five cities — Kochi, Mysore, Jaipur, Shimla and Bhubaneswar. These locations were selected to test the notes under different geographical and climatic conditions.
However, the pilot project was later put on hold because of technological and operational challenges. With the volume of currency in circulation increasing and printing costs rising, the RBI is once again examining the feasibility of polymer banknotes.
No timeline has been announced, but the proposal marks a renewed effort to modernise India’s currency system.
