Annual Report

During 2025-26, the Reserve Bank continued with its efforts towards upgradation of the currency management infrastructure in the country while remaining focused on ensuring adequate supply of clean banknotes in circulation. Efforts were started towards research and development for bringing about innovation in various facets of currency management and indigenisation of security features.

VIII.1 In pursuance of its Clean Note Policy, the Reserve Bank remained committed to ensuring supply of clean banknotes and coins to meet the cash demand of the economy. The Reserve Bank took forward the plan to modernise the currency management infrastructure in the country. The Reserve Bank also conducted a survey on assessing the payment behaviour of the households for collecting inputs for policy fine-tuning.

VIII.2 Against this backdrop, the rest of the chapter is organised into five sections. Section 2 covers the implementation status of the agenda for 2025-26, followed by section 3 covering important developments in currency in circulation along with other initiatives undertaken during the year. The developments with regard to Bharatiya Reserve Bank Note Mudran Private Ltd. (BRBNMPL), a wholly owned subsidiary of the Reserve Bank, are given in section 4. The Department of Currency Management’s agenda for 2026-27 is provided in section 5 with concluding observations in section 6.

2. Agenda for 2025-26

VIII.3 The Department had set out the following goals for 2025-26:

• Carrying forward the project on modernisation of the currency management infrastructure (Paragraph VIII.4);

• Strengthening the integrity of Indian banknotes through introduction of new/ upgraded security features (Paragraph VIII.5);

• Installation and commencement of operation of new Shredding and Briquetting Systems (SBS) [Paragraph VIII.6];

• Capacity augmentation for processing of banknotes (Paragraph VIII.7); and

• Understanding the payment behaviour of the public through survey (Paragraph VIII.8).

Implementation Status

VIII.4 The Reserve Bank held stakeholder engagements to carve out the appropriate architecture for currency management infrastructure of the country.

VIII.5 Substantial progress was made in the process of rolling out of new security features in the banknotes. A phased roll out of banknotes with new/ upgraded security features is expected to start from the middle of 2026.

VIII.6 The upgradation of banknote processing infrastructure at Reserve Bank’s Issue offices continued with installation of new SBS machines.

VIII.7 The augmentation of cash processing infrastructure with procurement of new Currency Verification and Processing Systems (CVPS) is underway.

VIII.8 To understand usage and preference for cash and digital modes of payments, a survey on households’ payment behaviour among individuals and small retail sellers was conducted. The survey results indicated continued strong preference for usage of cash.

3. Developments in Currency in Circulation

Banknotes

VIII.9 The value and volume of banknotes in circulation increased by 11.9 per cent and 10.5 per cent, respectively, during 2025-26 (Table VIII.1). In volume terms, ₹500 denomination constituted the highest share of the total banknotes in circulation, followed by ₹10 denomination banknotes.

Withdrawal of ₹2000 Denomination Banknotes from Circulation

VIII.10 The withdrawal of ₹2000 banknotes from circulation, initiated in terms of press release dated May 19, 2023, which continued during the year and 98.45 per cent of ₹3.56 lakh crores in circulation at the time of announcement, have since returned up to March 31, 2026. The facility for exchange and deposit of the ₹2000 banknotes is presently available at 19 Issue Offices¹ of the Reserve Bank. The ₹2000 banknotes can also be sent through India Post from any post office in the country to any of the Reserve Bank’s 19 Issue offices for credit to the bank accounts in India.

Coins

VIII.11 The total value as well as volume of coins in circulation increased by 11.4 per cent and 4.5 per cent, respectively, during 2025-26 (Table VIII.2). As on March 31, 2026, coins of ₹1, ₹2 and ₹5 together constituted 80.7 per cent of the total volume of coins in circulation, while in value terms, these denominations accounted for 60.2 per cent.

e₹ in Circulation

VIII.12 As on March 31, 2026, the value of e₹ in circulation stood at ₹771.7 crore as against ₹1,016.5 crore as on March 31, 2025.

Currency Management Infrastructure

VIII.13 The functions relating to issuance of currency (i.e., banknotes and coins) and their management are performed by the Reserve Bank through its 19 Issue Offices, 2,599 Currency Chests and 2,119 Small Coin Depots across the country. As on March 31, 2026, State Bank of India accounted for the highest share of Currency Chests (Table VIII.3).

Indent and Supply of Currency

VIII.14 The indent of banknotes for 2025-26 was lower than 2024-25 whereas the indent of coins for 2025-26 was higher than the previous year (Tables VIII.4 and VIII.5). The printing presses supplied banknotes as per the indent placed with them.

Disposal of Soiled Banknotes

VIII.15 The disposal of soiled banknotes during 2025-26 has been lower than that of the previous year on account of transient interruptions arising from the replacement of Shredding and Briquetting Systems (SBS) at Issue Offices of the Reserve Bank (Table VIII.6).

Counterfeit Notes

VIII.16 During 2025-26, out of the total Fake Indian Currency Notes (FICNs) detected in the banking sector, 2.4 per cent were detected at the Reserve Bank (Table VIII.7).

VIII.17 The counterfeit notes detected in the denominations of ₹10, ₹50, ₹100, ₹200 and ₹2000 declined during 2025-26, while those in ₹20 and ₹500 denominations increased by 47.4 per cent, and 20.5 per cent, respectively, as compared with the previous year (Table VIII.8).

Expenditure on Security Printing

VIII.18 The expenditure incurred on security printing during 2025-26 was ₹4,875.2 crore as against ₹6,372.8 crore during the previous year due to reduced indent of banknotes during 2025-26.

Other Initiatives

Launch of Indian Currency Microsite

VIII.19 Indian Currency Microsite (https://indiancurrency.rbi.org.in) was launched on September 10, 2025, replacing the earlier ‘Paisa Bolta Hai’ microsite. The microsite provides a platform to access information on banknotes such as details of the design and security features through a 360-degree view, multimedia (video, audio and animation) and interactive games with simple and efficient navigation. The microsite also has a dedicated section for information on exchange of banknotes.

Revision of Services under Citizen’s Charter

VIII.20 Three services pertaining to exchange of notes received through Postal Covers, Triple Lock Receptacles (TLRs) and notes that cannot withstand normal handling, have now been brought under the ambit of citizen’s charter to ensure efficiency in services to general public.

Awareness Campaign on Misinformation on Coins, Mobile Aided Note Identifier (MANI) and Exchange Facility for Soiled Banknotes

VIII.21 Sustained awareness campaigns through print, digital and social media to dispel misinformation on coins resulted in substantial increase in acceptance of coins amongst public. Further, media campaigns were also organised for creating awareness on exchange facility for soiled notes.

Improved safety and hygiene standards of banknotes

VIII.22 Anti-bacterial and anti-microbial treatments developed inhouse by our banknotes paper mill was integrated into the paper manufacturing process. This has resulted into further improvements in safety and hygiene standards of Indian banknotes.

4. Bharatiya Reserve Bank Note Mudran Private Ltd. (BRBNMPL)

VIII.23 The BRBNMPL has been playing a critical role in designing, printing and supply of banknotes. During the year, print trials of varnished notes were conducted at the Mysuru printing press of BRBNMPL. Currency Research and Development Centre (CRDC), which functions under the aegis of BRBNMPL, initiated efforts to collaborate with research institutions in the areas of Research and Development (R&D) in banknotes.

5. Agenda for 2026-27

VIII.24 During the year, the Department will focus on the following:

• Strengthening the integrity of Indian Banknotes through introduction of new/ upgraded security features;

• Improvements in substrate of banknotes for enhanced durability (Utkarsh 2029);

• Capacity augmentation for processing of banknotes; and

• Continuing with the efforts towards improvements in existing Issue Offices and opening of two new Issue Offices.

6. Conclusion

VIII.25 During 2025-26, the Reserve Bank sustained its efforts towards ensuring adequate supply of clean currency for the public, focusing on improving efficiency of banknote distribution and deepening public awareness regarding the authenticity, security, and proper handling of banknotes and coins. Going ahead, maintaining the self-sufficiency in banknote production with indigenisation across the spectrum, enhancing the lifespan, security and integrity of banknote design, and improving the quality of banknotes in circulation, shall remain the priority areas.

¹ Ahmedabad, Bengaluru, Belapur, Bhopal, Bhubaneswar, Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur, Jammu, Kanpur, Kolkata, Lucknow, Mumbai, Nagpur, New Delhi, Patna and Thiruvananthapuram.

Index