May need more currency as GDP size increasing: RBI official
With the country's Gross Domestic Product (GDP) size increasing in quantitative terms, there could be a need for more currency in the economy, a Reserve Bank of India official said today. Following demonetization in November 2016, when the government junked high-value currency notes of denominations 500 and 1,000, there was a shrinkage in currency in the system, said the RBI official. Here's more.
Government, RBI introduced Rs. 500, Rs. 2000 banknotes post demonetization
"Now, with the growth in GDP, there may be a need for more currency in the system," the RBI official commented further. Post-demonetization, the government re-introduced Rs. 500 banknote and discontinued Rs. 1,000 currency note. Meanwhile, RBI introduced banknotes of denomination 2,000 during that period.
RBI to appoint ombudsman for deposit-taking NBFCs
The official further said there has been a decline in counterfeit notes and whatever is in circulation currently is "very crude counterfeiting". "The bank will also be issuing more security features in the currency for which pre-qualification bid notice has been floated," he added. Regarding NBFC, another official said that RBI would appoint an ombudsman for deposit-taking NBFCs, with addition of a digital ombudsman.
Reserve Bank also pursuing national strategy on financial inclusion
The apex bank has been pursuing a national strategy on financial inclusion, the official said, and has also formed an expert committee for MSMEs to avail bank credit without much hassle. The RBI had also started co-origination of loans with banks and NBFCs, which would help the customers in getting a better rate as the cost of bank funds would be low, he added.
