RBI/2016-17/21
DCM (NE) No.G-1/08.07.18/2016-17
July 18, 2016
The Chairman and Managing Director /
The Managing Director/
The Chief Executive Officer
All Banks
Madam / Dear Sir
Master Circular – Facility for Exchange of Notes and
Coins
Please refer to the Master Circular DCM (NE) No.G-2/08.07.18/2015-16 dated
July 01, 2015 containing instructions on the facility for exchange of notes and
coins. A revised version of Master Circular on the subject is annexed for your
information and necessary action. This Master Circular is placed in our website
www.rbi.org.in.
Yours faithfully
(P. Vijaya Kumar)
Chief General Manager
Encl. As above
ANNEX
Master Circular – Facility for Exchange
of Notes and Coins dated July 18, 2016
1. Facility for exchange of notes and coins at bank branches
(a) All branches of banks in all parts of the
country should provide the following customer services, more actively and
vigorously to the members of public so that there is no need for them to
approach the RBI Regional Offices for this purpose:
(i) Issuing fresh / good quality notes and coins of
all denominations on demand,
(ii) Exchanging soiled / mutilated / defective
notes, and
(iii) Accepting coins and notes either for
transactions or exchange.
(b) All branches should provide the above
facilities to members of public without any discrimination on all working days.
The scheme of providing exchange facility by a few select currency chest
branches on one of the Sundays in a month will remain unchanged. The names and
addresses of such bank branches should be available with the respective banks.
(c) The availability of the above-mentioned
facilities at the bank branches should be given wide publicity for information
of the public at large.
(d) None of the bank branches should refuse to
accept small denomination notes and / or coins tendered at their counters.
2. Reserve Bank of India (Note Refund) Rules, 2009 - Delegation
of powers
(a) In terms of Section 28 read with Section 58 (2) of Reserve Bank of India
Act, 1934, no person is entitled as a right to recover from the Government of
India or RBI the value of any lost, stolen, mutilated or imperfect currency note
of the GOI or banknote. However, with a view to mitigating the hardship to the
public in genuine cases, it has been provided that the RBI may, with the
previous sanction of the Central Government, prescribe the circumstances in, and
the conditions and limitations subject to which, the value of such currency
notes or banknotes may be refunded as a matter of grace.
(b) With a view to extending the facility for the benefit and convenience of
public, all branches of banks have been delegated powers under Rule 2(j) of
Reserve Bank of India (Note Refund) Rules, 2009 for exchange of mutilated /
defective notes free of cost.
3. Liberalized definition of a Soiled Note
In order to facilitate quicker exchange facilities, the definition of soiled
note has been liberalized. A ‘soiled note’ means a note which has become dirty
due to normal wear and tear and also includes a two piece note pasted together
wherein both the pieces presented belong to the same note and form the entire
note with no essential feature missing. These notes should be accepted over bank
counters in payment of Government dues and for credit to accounts of the public
maintained with banks. However, in no case, these notes should be issued to the
public as re-issuable notes and shall be deposited in currency chests for onward
transmission to RBI offices as soiled note remittances for further processing.
4. Mutilated Notes – Presentation and Passing
A mutilated note is a note of which a portion is missing or which is composed
of more than two pieces. Mutilated notes may be presented at any of the bank
branches. The notes so presented shall be accepted, exchanged and adjudicated in
accordance with Reserve Bank of India (Note Refund) Rules 2009.
5. Extremely brittle, burnt, charred, stuck up Notes
Notes which have turned extremely brittle or are badly burnt, charred or
inseparably stuck up together and, therefore, cannot withstand normal handling,
shall not be accepted by the bank branches for exchange. Instead, the holders
may be advised to tender these notes to the concerned Issue Office where they
will be adjudicated under a Special Procedure.
6. Procedure for exchange of soiled/ mutilated/ imperfect notes
6.1 Exchange of soiled notes
6.1.1 Notes presented in small number: Where the number of notes presented by
a person is up to 20 pieces with a maximum value of Rs.5000 per day, banks
should exchange them over the counter, free of charge.
6.1.2 Notes presented in bulk: Where the number of notes presented by a
person exceeds 20 pieces or Rs.5000 in value per day, banks may accept them,
against receipt, for value to be credited later. Banks may levy service charges
as permitted in Master Circular on Customer Service in Banks
(DBR.No.Leg.BC.21/09.07.006/2015-16 dated July 1, 2015). In case tendered value
is above Rs.50000, banks are expected to take the usual precautions.
6.2 Exchange of mutilated and imperfect notes
6.2.1 While designated branches may continue to follow the procedure as laid
down in Part III of NRR, 2009 (www.rbi.org.in →Publications→Occassional) for
exchanging mutilated and imperfect notes and issue receipt for the notes
presented for adjudication, non-chest branches are required to follow the
following procedure for notes presented in small numbers and in bulk.
6.2.2 Notes presented in small number: Where the number of notes presented by
a person is up to 5 pieces, non-chest branches should normally adjudicate the
notes as per the procedure laid down in Part III of NRR, 2009 and pay the
exchange value over the counter. If the non-chest branches are not able to
adjudicate the mutilated notes, the notes may be received against a receipt and
sent to the linked currency chest branch for adjudication. The probable date of
payment should be informed to the tenderers on the receipt itself and the same
should not exceed 30 days. Bank account details should be obtained from the
tenderers for crediting the exchange value by electronic means.
6.2.3 Notes presented in bulk: Where the number of notes presented by a
person is more than 5 pieces not exceeding Rs.5000 in value, should be advised
to send such notes to nearby currency chest branch by insured post giving his /
her bank account details (a/c no, branch name, IFSC, etc.) or get them exchanged
thereat in person. All other persons tendering mutilated notes whose value
exceeds Rs.5000 should be advised to approach nearby currency chest branch.
Currency chest branches receiving mutilated notes through insured post should
credit the exchange value to the account of sender by electronic means within 30
days of receipt of notes.
6.3 Tenderers aggrieved with the service provided
by the banks in this regard may approach Banking Ombudsman concerned, following
the procedure as laid under Banking Ombudsman Scheme, 2006 with the bank /postal
receipts as proof for necessary action.
7. Notes bearing "PAY"/"PAID" "REJECT" stamps
(a) Every Officer-in-charge of the branch i.e. the
Branch Manager and every Officer-in-charge of the Accounts or Cash Wing of the
Branch shall act as 'Prescribed Officer' in each branch to adjudicate the notes
received at the branch for exchange in accordance with Reserve Bank of India
(Note Refund) Rules, 2009. After adjudicating mutilated notes, the Prescribed
Officer is required to record his order by subscribing his initials to the dated
'PAY'/ 'PAID'/ 'REJECT' stamp. The 'PAY' /'PAID' & 'REJECT' stamps should also
carry the name of the bank and branch concerned and held under the custody of
the 'Prescribed Officer' to avoid misuse.
(b) Mutilated / defective notes bearing
'PAY'/'PAID' (or 'REJECT') stamp of any RBI Issue Office or any bank branch, if
presented for payment again at any of the bank branches should be rejected under
Rule 6(2) of Reserve Bank of India (Note Refund) Rules, 2009 and the tenderer
should be advised that the value of such note/s cannot be paid since the same
has already been paid as is evident from the PAY/PAID stamps affixed on it/them.
All bank branches have instructions not to issue notes bearing PAY/PAID stamps
to the public even through oversight. The branches should caution their
customers not to accept such notes from any bank or anybody else.
8. Notes bearing slogans / political messages, etc.
Any note with slogans and message of a political nature written across it
ceases to be a legal tender and the claim on such a note will be rejected under
Rule 6(3) (iii) of Reserve Bank of India (Note Refund) Rules, 2009. Similarly,
notes which are disfigured may also be rejected under Rule 6(3) (ii) of Reserve
Bank of India (Note Refund) Rules, 2009
9. Deliberately cut notes
The notes, which are found to be deliberately cut, torn, altered or tampered
with, if presented for payment of exchange value should be rejected under Rule
6(3)(ii) of the Reserve Bank of India (Note Refund) Rules, 2009. Although it is
not possible to precisely define deliberately cut notes, a close look at such
notes will clearly reveal any deliberate fraudulent intention, as the manner in
which such notes are mutilated will follow a broad uniformity in the
shape/location of missing portions of the notes, especially when the notes are
tendered in large numbers. The details of the case such as the name of the
tenderer, the number of notes tendered and their denominations should be
reported thereafter to the Deputy/General Manager, Issue Department, under whose
jurisdiction the branch falls. The matter should also be reported to local
police in case a large number of such notes are tendered.
10. Training
Our Issue Offices conduct training programmes for 'Prescribed Officers' of
bank branches on a priority basis. As the training programmes are intended to
provide knowledge and instill confidence in the Prescribed Officers in the
process of adjudication of defective notes, it is imperative that the Prescribed
Officers of the branches are deputed for such programmes.
11. Display of Notice Board
All bank branches are required to display at their branch premises, at a
prominent place, a board indicating the availability of note exchange facility
with the legend, "SOILED/MUTILATED NOTES ARE ACCEPTED AND EXCHANGED HERE" for
information of general public. Banks should ensure that all their branches
provide facility for exchange of notes and coins not only to their customers but
also others. However, they should ensure that the note exchange facility is not
cornered by money changers / dealers in defective notes.
12. Disposal of notes adjudicated at bank branches
Regarding audit of the notes adjudicated by bank branches, the full value
paid notes have to be remitted by all branches to the chest branches with which
they have been linked and therefrom to the Issue Offices concerned together with
the next soiled note remittance in the manner already laid down. The half value
paid notes and rejected notes, which are held by the chest branches in their
cash balance, may either be remitted separately packed together with the full
value paid notes or sent by registered and insured post as and when required.
The full value paid notes will be treated as chest remittance by the Issue
Office while the half value paid notes and rejected notes will be treated as
notes tendered for adjudication and processed accordingly. All chest branches
are required to submit to our Issue Offices a monthly statement showing the
number of notes adjudicated during the month.
13. Agreement between RBI and commercial banks
(a) The bank branches should accept coins in
exchange of notes.
(b) They should accept coins of all denominations
which are legal tender under the Indian Coinage Act, 2011 from any member of
public without any restriction and pay the value in notes.
(c) They should use Coin counting machines or
accept coins by weight for large receipts, as hitherto to facilitate the
customers.
14. Uncurrent Coins
The coins of denomination of 25 paise and below, issued from time to time,
ceased to be legal tender for payments as well as account with effect from June
30, 2011 in terms of Gazette Notification No.2529 dated December 20, 2010 issued
by the Government of India. All such coins should be retained in the Small Coin
Depots (SCDs) of the bank till further advise from Reserve Bank of India.
15. Monitoring and Control
(a) The Regional Managers / Zonal Managers of the
banks may pay surprise visits to the branches and report the position of
compliance in this regard to the Head Office which will review such reports and
take prompt remedial action, wherever necessary.
(b) Any non-compliance in this regard shall be
viewed as violation of instructions issued by the Reserve Bank of India.
Master Circular – Facility for Exchange of Notes and Coins dated July 18, 2016
List of circulars / notifications consolidated by the Master Circular
Sr.No. |
Circular / Notification No. |
Date |
Subject |
1 |
DCM(NE)No.120/08.07.18/2016-17 |
14.07.2016 |
Facility for Exchange of Soiled/ Mutilated/ Imperfect Notes |
2 |
DCM(NE)No.3498/08.07.18/2012-13 |
28.01.2013 |
Facility for exchange of notes and coins |
3 |
DCM (Plg).No.6983/10.03.03/2010-11 |
28.6.2011 |
Call in from circulation coins of the denomination of 25 paise and
below |
4 |
DCM (Plg).No.6476/10.03.03/2010-11 |
31.5.2011 |
Call in from circulation coins of the denomination of 25 paise and
below-complaints reading non-acceptance of |
5 |
DCM (Plg).No.4459/10.03.03/2010-11 |
09.2.2011 |
Call in from circulation coins of the denomination of 25 paise and
below. |
6 |
DCM (Plg).No.4137/10.03.03/2010-11 |
25.1.2011 |
Call in from circulation coins of the denomination of 25 paise and
below. |
7 |
Gazette of India No.2529 |
20.12.2010 |
Notification for withdrawal of 25 paise and below coins |
8 |
DCM(RMMT)No.1277/11.36.03/2010-11 |
24.8.2010 |
Exchange Facilities by Currency Chest branches / scheme for
providing facilities |
9 |
DCM(NE)No.1612/08.01.01/2009-10 |
13.9.2009 |
Notification of Note Refund(Rules), 2009 |
10 |
RBI/2006-07/349/DCM (NE)No.7488/08.07.18/ 2006-07 |
25.4.2007 |
Acceptance of Small Denomination Notes and Coins. |
11 |
DCM(RMMT)No.1181/11.37.01/2003-04 |
05.4.2004 |
Acceptance of coins. |
12 |
DCM(NE)No.310/08.07.18/2003-04 |
19.1.2004 |
Providing facilities to public for exchange of notes, coins, etc. |
13 |
DCM(RMMT)No.404/11.37.01/2003-04 |
09.10.2003 |
Acceptance of coins and availability of notes. |
14 |
G-11/08.07.18/2001-02 |
02.11.2001 |
Reserve Bank of India (Note Refund) Rules, 1975 – Delegation of note
exchange powers to currency chest branches of Public/Private Sector
Banks. |
15 |
Cy.No.386/08.07.13/2000-2001 |
16.11.2000 |
Reserve Bank of India (Note Refund) Rules, 1975 – Delegation of full
note exchange powers to currency chest branches of Public/ Private
Sector Banks. |
16 |
G-67/08.07.18/96-97 |
18.2.1997 |
RBI (Note Refund) Rules, 1975, Delegation of full powers to private
sector banks maintaining currency chests |
17 |
G-52/08.07.18/96-97 |
11.1.1997 |
RBI (NR) Rules Scheme of delegation of powers to PSBs for exchange
of defective notes – Disposal of notes bearing PAY/PAID stamp. |
18 |
G-24/08.01.01/96-97 |
03.12.1996 |
Acceptance of Exchange of Cut Notes – Liberalization. |
19 |
G-64/08.07.18/95-96 |
18.5.1996 |
RBI(NR) Rules – Delegation of full powers to branches PSBs and
publicity for exchange of defective notes. |
20 |
G-71/08.07.18/92-93 |
22.6.1993 |
RBI(NR) Rules – Scheme of delegation of full powers for exchange of
defective notes to the branches of PSBs – Publicity. |
21 |
G-83/CL-1(PSB)-91/92 |
06.5.1992 |
RBI(NR) Rules – Delegation of powers to chest branches of PSBs. |
22 |
G-74/CL-(PSB)(Gen)-90/91 |
05.9.1991 |
RBI(NR) Rules – Delegation of full powers there under to PSBs. |
23 |
5.5/CL-1(PSB)-90/91 |
25.9.1990 |
RBI(NR) Rules – Scheme of delegation of full poweres to PSBs. |
24 |
8/CL-1(PSB)-90/91 |
17.8.1990 |
RBI(NR) Rules – Scheme of delegation of full powers to PSBs. |
25 |
G-123/CL-1(PSB)(Gen)-89/90 |
07.5.1990 |
RBI(NR) Rules – Scheme of delegation of full powers to PSBs
(Amendment). |
26 |
G-108/CL-1(PSB)(Gen)-89/90 |
03.4.1990 |
RBI(NR) Rules 1989 – Bank notes of Rs.500/- denomination – Exchange
of defective notes at branches of PSBs. |
27 |
G-8/CL-1(PSB)-89/90 |
12.7.1989 |
RBI(NR) Rules – Defective notes branded with 'To Claims' stamp of
RBI Issue Offices. |
28 |
G.84/CL.1(PSB)-88/89 |
17.3.1989 |
RBI(NR) Rules – Delegation of full note exchange powers to PSBs. |
29 |
G.66/CL.1(PSB)-88/89 |
09.2.1989 |
RBI(NR) Rules – Delegation of powers to PSBs – Training. |
30 |
S.12/CL-1(PSB)-88/89 |
30.9.1988 |
RBI(NR) Rules – Deliberately mutilated notes – Adjudication. |
31 |
G.134/CL-1(PSB)-87/89 |
25.5.1988 |
Implementation of the Scheme of delegation of full powers under
RBI(NR) Rules. |
32 |
192/CL-1-(PSB)-86/87 |
02.6.1987 |
RBI(NR) Rules – Scheme of delegation of full powers to PSBs. |
33 |
189/CL.2/86/87 |
02.6.1987 |
Defacing currency notes by writing on them or inscribing messages,
slogans etc. thereon. |
34 |
185/CL-1(PSB)-86/87 |
20.5.1987 |
RBI(NR) Rules – Affixing of 'PAY' and 'REJECT' stamps on defective
notes. |
35 |
173/CL.1/84/85 |
02.4.1985 |
Delegation of full powers to PSBs for exchange of defective
notes/procedures of the same. |
36 |
Cy.No.1064/CL.1/76/77 |
09.8.1976 |
Facilities to the public for exchange of soiled notes and slightly
mutilated notes. |
|