Thursday, May 11, 2006

RBI to come out with new "star series" bank notes

MSN autofeed reports this:

New star series banknotes introduced
Source: IANS.

New Delhi, May 10: In line with international practices, the Reserve Bank of India (RBI) has decided to introduce Rs.10, Rs.20 and Rs.50 bundles where the notes would not be placed in serial numbers.

This practice is being adopted to enable the central bank to replace the defective banknotes in a packet of 100.

In effect, when a customer gets a packet of new banknotes bearing a star, he or she may find that all the notes are not in serial order of one to 100. Instead, as in the case of used banknotes, the bundle of notes may require counting by both the bank and the customers.

To help in easy identification of such bundles, the banknotes would have a star in the number panel, the RBI stated in a statement issued on Tuesday.

Stressing that such banknotes should be treated as legal currency, RBI states "some fresh banknote packets issued by the bank may contain some notes having a star in the number panel in the space between the prefix and the number".

"To facilitate easy identification of note packets containing star series notes, the band on such packets will clearly indicate the presence of these notes in the packet."

Barring the additional star, the new notes would look exactly like other notes of similar denomination.

"The star series notes will be legal tender and members of public may freely accept and use these notes," the RBI has stated.

This move by the RBI is expected to help save on expensive printing mistakes, earlier done through replacement of defective notes, which not only resulted in additional expense but also delayed the process of issuing them.


My own comment on this matter:

It is high time the RBI did something about the quality of notes we have in circulation in India.

It is indeed shocking to see torn, stappled notes, notes with numbers, names and even faces drawn on them issued by bank cashiers.

From personal experiance i have seen that the lacklustre attitude of "anything comes, anything goes" that is prevalent in India, even sub-standard notes are happily issued by banks to consumers, and people never protest against it.

Part of the blame infact lies with the general public who dont handle notes with care.

Hopefully the new process will make it easier to screen out bad notes from the system.

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