Centre Okays Polymer Banknote Trials for ₹10 and ₹20 Denominations
UPSC / SSC current affairs note · Economy
Why in news
The government has approved RBI's proposal to conduct field trials of polymer banknotes in ₹10 and ₹20 denominations. This marks a significant step towards introducing plastic currency in India, though the government clarified there is no plan to replace paper notes yet.
Background
Polymer banknotes are made from plastic polymers, offering longer lifespan and better resistance to wear and tear compared to paper notes. Several countries like Australia, Canada, and the UK have adopted polymer currency. India has previously experimented with polymer notes, including a limited issue of ₹10 notes in 2001, but they were not widely circulated.
Key facts
RBI proposed printing 1 billion pieces each of ₹10 and ₹20 polymer banknotes for field trials.
The proposal was based on a recommendation from RBI's Central Board and has been approved by the government.
BRBNMPL (RBI's currency-printing arm) floated a Global Expression of Interest on July 17, 2026, for opacified polymer substrate sheets.
The EOI seeks 68,000 reams of BOPP-based polymer substrate (34,000 reams per denomination), each ream containing 500 sheets.
Required security features include clear window with portrait, metallic numeral, magnetic pseudo thread, shadow image, and iridescent pattern.
Bidders must firewall operations from China/Pakistan, avoid sourcing raw material from these countries, and not employ personnel who worked there.
Entities from land-border-sharing countries must be registered with DPIIT's Registration Committee.
The government clarified there is no plan to replace existing paper currency with polymer notes.
Successful trials will be followed by regular issuance of polymer banknotes.
Prelims pointers
- Polymer banknote denominations: ₹10 and ₹20
- Trial quantity: 1 billion pieces each
- RBI subsidiary: Bharatiya Reserve Bank Note Mudran Private Limited (BRBNMPL)
- Substrate material: BOPP (Biaxially Oriented Polypropylene)
- Security features: clear window with portrait, metallic numeral, magnetic pseudo thread, shadow image, iridescent pattern
- Global Expression of Interest date: July 17, 2026
- Countries with polymer notes: Australia, Canada, UK, etc.
- India's earlier polymer note experiment: ₹10 note in 2001
Mains angles
- Discuss the advantages and challenges of introducing polymer banknotes in India.
- Examine the security and economic implications of replacing paper currency with polymer notes.
- Analyze the role of RBI and government in currency management and innovation.