Centre Approves 1 Billion Polymer Banknotes in ₹10 and ₹20 Denominations

Gist The Union Government has granted approval to the Reserve Bank of India RBI to initiate field trials for one billion polymer-based banknotes in ₹10 and ₹20 denominations. Following successful testing, the central bank intends to circulate these plastic notes concurrently with traditional paper currency. Aspirants should track this transition as it signals a strategic shift in India’s currency management, aiming to permanently enhance the durability and security of fiat money. Background - The physical currency currently circulating in India is manufactured using a paper substrate composed primarily of cotton rag. As the sole currency-issuing authority, the RBI continuously monitors the lifecycle, physical degradation, and replacement costs of banknotes. - Lower denominations like ₹10 and ₹20 experience high transactional velocity, leading to rapid wear, soiling, and a significantly shortened lifespan. To address this structural inefficiency, the RBI is testing polymer banknotes—currency made from flexible plastics such as biaxially oriented polypropylene BOPP . - First pioneered by Australia in the late 1980s, polymer currency is now utilized globally because it resists dirt and moisture, lasts substantially longer than paper, and allows…