Pre-2005 notes of Rs 500, Rs 1,000 can still be deposited at banks: RBI

Banks can’t turn away customers depositing pre-2005 currency notes, including the junked 500 and 1,000 rupee bills, the Reserve Bank said on Monday.  

In a clarification, the RBI said these specified bank notes (SBNs) would also include pre-2005 banknotes in the denominations of Rs 500 and Rs 1,000.  

“Banks should accept deposits of pre-2005 banknotes in the denominations of Rs 500 and Rs 1,000 under the scheme, but not reissue these. These notes can be exchanged at RBI Offices only,” the RBI said in a clarification issued on Monday. 

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The RBI said it has been receiving queries as well as complaints from public from across the country that banks are not accepting pre-2005 banknotes.

With effect from November 9, 2016, banknotes of Rs 500 and Rs 1,000 were delegalised by the government with the aim to discourage black money hoarders as well as to bring a majority of the unaccounted money into the formal channel of banking.

Public in general can exchange the pre-2005 notes in their possession at Ahmedabad, Bengaluru, Belapur, Bhopal, Bhubaneswar, Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur, Jammu, Kanpur, Kolkata, Lucknow, Mumbai, Nagpur, New Delhi, Patna, Thiruvananthapuram and Kochi offices of the RBI.  

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“This, however, does not imply that banks cannot accept deposits of pre-2005 banknotes for crediting to the customers’ accounts,” RBI clarified further.

Pre-2005 banknotes are being withdrawn from circulation since January 2014 by RBI and a large percentage of these notes have already been withdrawn.

However, in a circular issued in June this year, RBI had said that a small percentage of these banknotes were still in circulation and allowed their exchange at the designated RBI branches.

Though the pre-2005 banknotes are being withdrawn, they still continue to remain legal tender.