The Central Government has approved the Reserve Bank of India’s (RBI) proposal to conduct field trials of ₹10 and ₹20 polymer currency notes, marking an important step toward exploring more durable and secure banknotes in India.
The announcement was made by Minister of State for Finance Pankaj Chaudhary in a written reply in the Lok Sabha. The pilot project will assess the performance of polymer notes under Indian conditions before any decision is taken on wider circulation.
Under Section 25 of the RBI Act, 1934, the government has approved the RBI’s proposal to conduct field trials involving:
- 100 crore ₹10 polymer notes
- 100 crore ₹20 polymer notes
The trial will help evaluate the notes under real-world conditions before considering large-scale implementation. The Finance Ministry clarified that the introduction of polymer notes does not mean the existing paper currency will be withdrawn.
During the trial period:
- Paper currency and polymer notes will circulate together.
- There is currently no proposal to discontinue paper ₹10 or ₹20 notes.
- The objective is to study the performance of polymer notes before taking any future policy decisions.
The field trial is designed to evaluate several important aspects of polymer currency, including:
- Durability under different weather conditions.
- Performance during daily handling.
- Public acceptance and ease of use.
- Suitability for India’s diverse climatic conditions.
The results will help determine whether polymer notes offer long-term advantages over traditional paper currency.
If introduced on a wider scale, polymer notes could offer several advantages:
Longer Lifespan
Polymer notes generally last longer than conventional paper notes, making them more resistant to wear and tear from frequent use.
Lower Replacement Costs
Because they remain in circulation for a longer period, fewer replacement notes may need to be printed, potentially reducing long-term currency management costs.
Enhanced Security Features
Polymer notes can incorporate advanced security elements such as:
- Transparent windows.
- Improved anti-counterfeiting features.
- Enhanced printing technologies.
These features can make counterfeiting more difficult.
Better Resistance to Moisture and Dirt
Polymer notes are typically more resistant to water, humidity, and dirt, helping maintain their quality over time.
Many countries, including Australia, Canada, the United Kingdom, Singapore, and New Zealand, already use polymer banknotes because of their durability and advanced security features.
The RBI’s pilot reflects India’s effort to evaluate whether similar technology could improve the country’s currency management system.
