Plastic currency to come soon, Centre tells Parliament

New Delhi: The Centre on Friday said in the Parliament that the cabinet has taken a decision to print plastic currency notes and procurement of materials for the same has already started.

"The cabinet has decided to print banknotes on plastic or polymer substrate. The procurement process for the same has already been initiated," said Minister of State for Finance Arjun Ram Meghwal.

Meghwal made the written reply in Lok Sabha replying to a question whether RBI suggests printing of plastic currency notes instead of paper ones.

The Reserve Bank of India (RBI) has been planning to launch plastic currency notes after field trials since long.

Earlier in February 2014, the government had informed Parliament that one billion plastic currency notes of Rs 10 would be introduced in a field trial in five different cities, which have been chosen on the basis on their geographical and climatic diversity.

It is to tell you that the elected cities were Kochi, Mysore, Jaipur, Shimla and Bhubaneswar.

Plastic notes are a good option as they last for around five years and are difficult to imitate. They also remain cleaner than the paper notes. Australia was the first country to use such notes in a bid to eradicate counterfeiting.

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Answering another query, Meghwal said that RBI in December 2015 informed that they had received some banknotes of Rs. 1,000 which didn't have security thread and were printed at Currency Note Press (CNP), Nashik, on paper supplied by Security Paper Mill (SPM), Hoshangabad.

A probe has been launched by Security Printing and Minting Corporation (SPMCIL) and the units involved (SPM and CNP).

"The concerned personnel has been issued a major penalty chargesheet. Disciplinary proceedings have been initiated as per departmental rules," the minister said.

He also claimed that the measures are being taken to ensure quality production of currency notes.

"Additional inspections have been introduced to ensure defect-free production," he said.