The Reserve Bank of India (RBI) will start pumping ₹200 notes into the system from Friday in a bid to ease cash transactions and make the currency system more efficient. The base colour of the ₹200 note will be bright yellow, RBI said in a statement on Thursday.
This is the second new denomination to be issued, after ₹2,000, since the demonetisation exercise in November.
According to currency experts, it is a standard practice to have 1, 2 and 5 series notes like ₹1, ₹2, and ₹5. Hence, there was a gap between ₹100 and ₹500. “There is a logical need to introduce the missing denomination of ₹200, which will make the present currency system more efficient,” the RBI said in a statement.
“Provision of the new denomination, therefore, would facilitate exchange, particularly for the common man who deals with denominations at the lower end,” it added. Bankers said ATMs may need to be re-calibrated to accommodate the new note, though no major disruption is expected.
A new ₹500 note has already been introduced and ₹50 notes in a fluorescent blue will follow shortly.
All the new notes are wallet-friendly, since they are slimmer than the earlier series of notes.
Know your note
The base colour of the ₹200 note will be bright yellow, the RBI said. The note will bear the signature of RBI governor Urjit Patel on the front and will have the ‘Swachh Bharat’ logo with slogan along with a motif of Sanchi Stupa on the reverse. The size dimensions of the ₹200 banknote will be are 66 mm × 146 mm — smaller than the existing ₹100 note (73 mm x 177mm).
Rationale - Renard Series
The main objective of central bank’s currency management department is to minimise the number of denominations in a transaction and at the same time increase the chance of presenting exact change.
Like many countries, India has adopted something similar to the Renard Series, that is, 1:2 or 1:2.5 ratio between adjacent denomination of currency. In other words, the denomination should be twice or two and half times its preceding denomination. Such a ratio allows exchange of value ordinarily in a maximum of three denominations.
“Provision of the new denomination would facilitate exchange, particularly for the common man who deals with denominations at the lower end,” RBI added.
Experts said the introduction of the ₹200 note will improve the efficiency of the present currency system of the country.
