The government had discontinued priting Re 1 notes in November 1994 due to higher printing costs
The Reserve Bank of India (RBI) today said that it will soon put in circulation of currency notes in one rupee (Re 1) denomination. The notes will be printed by the Government of India.
The government had discontinued priting Re 1 notes in November 1994 due to higher printing costs.
The RBI Act confers upon the right to the central bank to issue all notes, except Re 1. Such notes are issued by the government and bears the signature of finance secretary. All other denomination notes are signed by the governor of RBI.
The central bank has been gradually withdrawing lower denomination currency noted as the perceived benefit is lesser than the cost of printing such notes. Banking industry experts has termed the move to re-start printing of notes as more of symbolic as Re 1 coins are expected to be more in circulation.
As per the RBI Annual Report for 2013-14, there were 38424 million pieces of Re 1 coins in circulation (March 2014) and had seen a 7.07 per cent growth in its volumes compared to March 2013. However, its percentage share was 41.9 per cent in the coins in circulation space that includes small coins, and those coins with denomination of Rs 2, Rs 5 and Rs 10. Here, Re 1 coins had seen the lowest growth in volumes compared to the other denominations (excluding small coins) in March 2014 compared to March 2013. Its percentage share has also come down gradually from March 2012 onwards.
RBI in its release today has said that these currency notes (of Re 1) are legal tender as provided in The Coinage Act 2011. RBI said that the existing currency notes in this denomination in circulation will also continue to be legal tender.
While the Reserve Bank of India (RBI) has the authority to issue bank notes of denominational values of Rs. 2, Rs. 5, Rs. 10, Rs. 20, Rs. 50, Rs. 100, Rs. 500, Rs. 1,000, Rs. 5,000 and Rs. 10,000, the one rupee note was printed and issued by the central government.
The Government of India also has the sole right to mint coins of all denominations.