RBI Confirms 99.15% of Demonetized Money Coming Back

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"SBNs (specified banknotes) were received by the Reserve Bank either directly or from bank branches/ post offices through the currency chest mechanism".

Before demonetisation, Rs 500 and Rs 1,000 notes accounted for 86% of the currency in circulation.

(The) RBI report again proves that demonetisation was a "Modi-made disaster" of epic proportions.

"The enormous task of processing and verification of Specified Bank Notes (SBNs) was successfully achieved", RBI said.

According to NDTV, the RBI has taken an awfully long time to count the currency that was returned in the limited period, which was provided by the government to exchange or deposit the demonetised notes.

How much money is back?

The Reserve Bank of India in its annual report has said Rs 15.31 lakh crore out of the total Rs 15.41 lakh crore demonetised currency have returned to the banking system. More than 400 cases were referred to the Enforcement Directorate (ED) that arrested 18 evaders, while the Central Bureau of Investigation (CBI) arrested 38 people - insignificant numbers, but definitely a beginning.

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Collateral damage as a result of the rise in printing the notes and other cost was dividend RBI pays to the government. There was, however, a 2.1% increase in the volume of banknotes.

In March 2017, the share of Rs 500 and Rs 2,000 currency notes, in value terms, accounted for 72.7% of the total value of banknotes in circulation.

The process of verifying banned notes involved working in two shifts under strenuous conditions, maintaining detailed records and planning effectively without compromising on other functions of currency management. Counterfeiters had also shifted to recreating smaller notes and were now able to replicate en masse the new 500 and 2,000-rupee notes, it said.

Digital transactions have grown, but the RBI found the value of banknotes in circulation had also increased in the past year by 37.7%.

"... India's currency to GDP ratio moved up to 10.9 per cent in 2017- 18, returning to being amongst the highest levels of currency usage in peer emerging market economies (EMEs) and advanced economies (AEs) as well".

"I suspect that the bulk of the Rs 13,000 crore is in Nepal and Bhutan and some that was lost or destroyed".

PM Modi's decision to ban high-value currency notes, along with a chaotic introduction of the goods and services tax last year, acted as a drag on economic expansion with provisional data showing growth slumped to a four-year low of 6.6 percent in the fiscal year 2018.

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