Polymer Currency Comeback: RBI Gets Govt Nod for ₹10 & ₹20 Plastic Banknote Field Trials
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In a major step toward enhancing currency durability, the Central Government has approved a proposal from the Reserve Bank of India (RBI) to issue polymer (plastic) banknotes in ₹10 and ₹20 denominations on a trial basis.
Speaking in the Lok Sabha, Minister of State for Finance Pankaj Chaudhary confirmed that the government cleared the RBI's proposal to print 1 billion (100 crore) pieces each of ₹10 and ₹20 polymer notes—totalling 2 billion (200 crore) notes worth ₹3,000 crore—for real-world field trials.
The trial aims to test how plastic substrate currency performs under India's diverse climatic conditions and rigorous everyday usage before any regular or expanded rollout.
Global Tender Issued for Polymer Sheets
Accelerating the process, Bharatiya Reserve Bank Note Mudran Private Limited (BRBNMPL)—a wholly owned subsidiary of the RBI—floated a global tender on July 17 for 3.4 crore polymer sheets.
Immediate Scope: The initial procurement covers immediate printing needs for the two selected denominations.
Future Expansion: If the field trials yield positive results, the central bank plans to procure larger quantities of substrate across multiple denominations.
Second Attempt at Plastic Currency
This marks the RBI’s second major push toward plastic banknotes:
2009 Trial Attempt: In September 2009, the RBI invited bids to procure 100 crore pieces of ₹10 plastic notes for trials across five distinct climatic hubs—Kochi, Mysuru, Shimla, Jaipur, and Bhubaneswar.
Past Obstacles: The initial attempt faced setbacks due to technical issues, including reports that early automated teller machines (ATMs) and sorting machines struggled to process the plastic substrate smoothly.
Why Polymer Banknotes?
Lower-denomination notes (like ₹10 and ₹20) pass through numerous hands daily, causing rapid wear, tears, and soiling. Replacing damaged paper currency costs the central bank thousands of crores annually.
| Feature | Paper Banknotes | Polymer Banknotes |
|---|---|---|
| Lifespan | Short (frequent replacement needed) | Significantly longer (2x–3x higher durability) |
| Moisture Resistance | Soaks water/sweat, degrades quickly | Water-resistant, repels dirt and grease |
| Security Features | Standard threads and watermarks | Enhanced anti-counterfeiting transparent windows |
| Environmental Impact | Frequent printing & disposal waste | Fully recyclable at end-of-life |
Will Existing Paper Currency Be Discontinued?
No. The government has explicitly clarified that there is no proposal to phase out or replace paper currency with polymer substrate.
Official Clarification: Polymer banknotes will circulate alongside existing paper notes as complementary tender. The general public will not need to exchange or surrender their paper currency. Furthermore, the RBI considers physical currency and digital payment systems (like UPI) to be complementary payment tools.
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