The Reserve Bank of India (RBI) is set to introduce plastic banknotes in Rs 10 and Rs 20 denominations, issuing 100 crore notes of each type. The total trial involves 200 crore polymer banknotes, worth approximately Rs 3,000 crore. The central bank has floated a tender to procure material for the polymer notes, reviving a proposal that has been under consideration for nearly two decades.
Polymer notes are made from durable plastic film instead of paper, giving them a longer lifespan and greater resistance to wear and tear. They require less frequent replacement than conventional paper currency, potentially reducing printing and replacement costs over time. The move aims to test the feasibility of plastic currency in India through a large-scale pilot.
The Rs 10 and Rs 20 notes are among the most widely circulated and frequently handled denominations, making them ideal candidates for the trial. The RBI's initiative follows similar steps taken by other countries, including Australia, Canada, and the United Kingdom, which have adopted polymer notes to enhance durability and security.
Paper money will continue to be accepted as legal tender alongside the new plastic notes during the trial period. The RBI has not announced a specific timeline for the rollout but is moving forward with procurement.