The central bank has initiated the tendering process to procure polymer substrate and will test the notes under Indian climatic and usage conditions before deciding on a wider rollout.
“We are still at a pilot stage. We will test and check how they perform in Indian conditions, climate, and other infrastructure we have put in place. It is only thereafter that we will see if we need to further scale it up as it is or with changes,” Malhotra said. “We are targeting that they are in circulation, if everything goes as planned, in the beginning of the next financial year,” he added.
Malhotra said the move has two key objectives. First, polymer notes have a much longer lifespan than paper currency, making them suitable for lower-denomination notes that see high circulation and wear and tear. Polymer notes have been used in several countries for more than 30 years and typically last three to four times longer than paper notes, he said.
Second, polymer notes will expand the RBI’s currency printing capacity as the economy’s cash requirements grow.
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