99.3% Of Demonetised Currency Back In System: RBI Report

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The old notes of 500-rupee and 1,000-rupee denomination ceased to be legal tender from December 31, 2016.

"I suspect that the bulk of the Rs 13,000 crore is currency in Nepal and Bhutan and some that was lost or destroyed".

"Whether demonetisation has failed or not depends on its objective".

While overall detection of counterfeit notes was 31.4% lower than the previous year, this was because of a decrease in fake Rs 500 and Rs 1,000 notes, which were of course banned in November 2016. The total value of SBNs in circulation as on November 8th, 2016 was 15417.93 Billion which means almost all (99.15%) banned notes were deposited back indicating that the Demonetization is a big failure.

Now, that the statistics have been revealed the entire argument of Modi government that the exercise curbed black money that has been in circulation falls flat.

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Now, even if 100% of demonetised currency returned to the system, it does not mean all of this cash was "white" or money that was generated through wholly legal means.

The SBNs received were verified, counted and processed in sophisticated high-speed Currency Verification and Processing System (CVPS) for accuracy and genuineness and then shredded, it added.

In 2017-18 (July 2017 to June 2018), it spent another Rs 4,912 crore on printing of currency, the annual report said. Banks have received Rs 15.3 trillion ($217 billion), or 99.3% of the currency invalidated, RBI said in the annual report released today. Verification and process of the SBNs has been completed. It was supposed to flush out black money and end corruption. But the goal posts kept shifting in the weeks and months since with the government citing several reasons to demonetise high value notes such as to choke terror funding, bribery, increasing tax base and checking counterfeit notes.

Senior Congress leader P. Chidambaram Wednesday slammed the government after the Reserve Bank of India (RBI) said that as much as 99.3 per cent of the demonetised Rs 500 and Rs 1,000 notes have returned to the banking system, saying the Indian economy had suffered due to the notes ban by way of job loss, closure of industries and the GDP growth. "In consonance, the use of digital payments, which had surged to a peak in December 2016 in the aftermath of demonetisation, fell back to the elevated post-demonetisation trend before rising in recent months", the RBI notes.

The annual report, curiously, also provides a glimpse of how attempts at remonetisation over the a year ago focused heavily on supplying the new Rs 500 and Rs 200 currency notes.