Regarding Exchange of Notes and Coins – RBI

All branches of banks in all parts of the country have been instructed to provide the following customer services so that there is no need for them to approach the RBI Regional Offices for this purpose:

(i) Issuing fresh / good quality notes and coins of all denominations on demand,

(ii) Exchanging soiled / mutilated / defective notes, and

(iii) Accepting coins and notes either for transactions or exchange.

All branches should provide the above facilities to members of public without any discrimination on all working days. None of the bank branches should refuse to accept small denomination notes and / or coins tendered at their counters.

In order to facilitate quicker exchange facilities, the definition of soiled note has been liberalized. A ‘soiled note’ means a note which has become dirty due to normal wear and tear and also includes a two piece note pasted together wherein both the pieces presented belong to the same note and form the entire note with no essential feature missing. These notes should be accepted over bank counters in payment of Government dues and for credit to accounts of the public maintained with banks. However, in no case, these notes should be issued to the public as re-issuable notes and shall be deposited in currency chests for onward transmission to RBI offices as soiled note remittances for further processing.

A mutilated note is a note of which a portion is missing or which is composed of more than two pieces. Mutilated notes may be presented at any of the bank branches. The notes so presented shall be accepted, exchanged and adjudicated in accordance with Reserve Bank of India (Note Refund) Rules 2009.

Notes which have turned extremely brittle or are badly burnt, charred or inseparably stuck up together and, therefore, cannot withstand normal handling, shall not be accepted by the bank branches for exchange. Instead, the holders may be advised to tender these notes to the concerned Issue Office where they will be adjudicated under a Special Procedure.

Every Officer-in-charge of the branch i.e. the Branch Manager and every Officer-in-charge of the Accounts or Cash Wing of the Branch shall record his order by subscribing his initials to the dated ‘PAY’/ ‘PAID’/ ‘REJECT’ stamp. The ‘PAY’ /’PAID’ & ‘REJECT’ stamps should also carry the name of the bank and branch concerned and held under the custody of the ‘Prescribed Officer’ to avoid misuse.

Mutilated / defective notes bearing ‘PAY’/’PAID’ (or ‘REJECT’) stamp of any RBI Issue Office or any bank branch, if presented for payment again at any of the bank branches should be rejected under Rule 6(2) of Reserve Bank of India (Note Refund) Rules, 2009.

Any note with slogans and message of a political nature written across it ceases to be a legal tender and the claim on such a note will be rejected under Rule 6(3) (iii) of Reserve Bank of India (Note Refund) Rules, 2009. Similarly, notes which are disfigured may also be rejected under Rule 6(3) (ii) of Reserve Bank of India (Note Refund) Rules, 2009

All bank branches are required to display at their branch premises, at a prominent place, a board indicating the availability of note exchange facility with the legend, “SOILED/MUTILATED NOTES ARE ACCEPTED AND EXCHANGED HERE” for information of general public.

The full value paid notes have to be remitted by all branches to the chest branches with which they have been linked and therefrom to the Issue Offices concerned together with the next soiled note remittance in the manner already laid down. The half value paid notes and rejected notes, which are held by the chest branches in their cash balance, may either be remitted separately packed together with the full value paid notes or sent by registered and insured post as and when required.