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'Rs 2,000 note is not easily available'

March 31, 2023 11:14 IST

Photograph: Jayanta Dey/Reuters

The non-availability of Rs 2,000 denomination currency notes in the banking system has prompted commercial banks to reconfigure the cassettes of cash dispensers in automated teller machines (ATMs) so that they can hold lower denominations.

Large ATM manufacturers say only about 15-20 per cent of ATMs have the Rs 2,000 denomination cassette, which was configured during the demonetisation exercise of 2016.

There are about 220,000 ATMs managed by different banks, apart from 31,500 white-label ATMs as of March 2022.

Industry players said the unavailability of Rs 2,000 notes is the reason why cassettes of most ATMs have been reconfigured.

"The Rs 2,000 note is not easily available. There are only some banks which still prefer to load a cassette with Rs 2,000 notes. Only at ATMs where cash dispensed is very high does a bank load the Rs 2,000 denomination," informed an industry source.


Photograph: The late Danish Siddiqui/Reuters

The Rs 2,000 notes in circulation peaked in 2017, when 3,285 million pieces were in circulation, constituting 50.2 per cent of the total value of currencies.

By the end of March 2022, only 2,140 million pieces of Rs 2,000 denomination currency notes were in circulation, or 13.8 per cent of the total value of notes.

"In the past one-and-a-half years, we have seen most ATMs recalibrated because it is like one empty cassette sitting there. Banks lose customers over a long weekend," said the official quoted earlier.

According to an executive at another large ATM network, the denomination of notes to be dispensed at any ATM depends on the bank.

The bank decides the denomination of notes it wants to refill at any given location.

That depends on the currency notes it receives from the Reserve Bank of India.

If banks decide not to load Rs 2,000 notes, the cassettes have to be reconfigured. We have not received any large requests from banks or service providers to reconfigure the cassette that dispenses the Rs 2,000 denomination because of unavailability. The revalue ration is done as a normal field activity as and when required," said the official.

While the share of Rs 2,000 notes has fallen, the share of Rs 500 notes has increased, constituting 73.3 per cent of the value of currency in circulation as of March 2022.

According to industry players, the ideal mix in the absence of Rs 2,000 notes is two cassettes with Rs 500 and one with Rs 100 and the other with Rs 200.

However, many banks load three with Rs 500 and one with Rs 100 or Rs 200.

Few banks still load Rs 2,000 notes at some ATMs, where the amount of cash dispensed is very high.

ATMs have four cassettes; one cassette can hold Rs 2,200 currency notes.

"If you load Rs 2,000 notes, you get Rs 44 lakh in one cassette. If you load the next denomination, which is Rs 500, you get one-fourth of that, Rs 11 lakh. That in a long weekend is where the bank finds it difficult to manage cash in an ATM," said another industry official.

With the government and the regulator emphasising digital payments, the growth of ATMs has slowed in recent years.

Consolidation of public sector banks in the past few years is also one reason for the slow expansion of cash-dispensing machines, observed bankers.

Feature Presentation: Rajesh Alva/

Manojit Saha & Subrata Panda
Source: source image