The Reserve Bank of India operates on the principles of updating periodic policies concerning the currency operations of the country. The latest policy from the RBI concerns an awful and sometimes harsh collection of rules that put the bank customer in a more difficult state of dealing with the banks on the exchange of torn or damaged notes. You may not be able to change your mutilated or badly damaged currency now.
Here is everything you need to know regarding the new RBI guidelines for the exchange of damaged notes.
Why Do Banks Take Back Torn Notes?
Badly damaged notes unfit for public usage would be taken out under the new policy from the RBI, in turn issuing fresh currency to sustain smooth transactions in the market. This ensures that because of using clean notes only and still usable in the system, counterfeit money risks reduce and generally improves cash quality.
Will You Be Charged for Exchanging Torn Notes?
Under the new RBI rules, it states that one can still go and exchange torn notes in any bank branch or outside the bank’s reach, like an RBI office. Nevertheless, banks might charge fees, depending on the extent of damage. You may get the entire amount refunded if the note is a little torn; however, severely damaged notes attract a deduction in money value.
How Many Torn Notes Can You Exchange at Once?
The number of damaged notes has been restricted by the RBI-in an exchange in one transaction to:
- A maximum of 20 notes per transaction
- The total value should not exceed 5000Rs
If the amount is within this limit, the bank should make it available for immediate processing. For larger amounts (over 50,000 Rs), the bank may credit this into your account instead of instant cash.
When Can a Bank Refuse to Exchange Torn Notes?
Banks generally accept such soiled notes, mutilated and partially damaged, but which would have retained major security features intact. Those completely burnt, chemically damaged, or intentionally destroyed notes may be, however, rejected. The bank examines whether the damage was accidental or deliberate before entering into an exchange.
Special Rules for Severely Damaged Notes
If your notes are very badly burnt, stuck together, or excessively damaged, then the ordinary banks will not allow you to change them. Therefore, it would become important for you to go to the RBI office for evaluation. The RBI applies a diverse verification mechanism for such notes, and it might also compensate you following inspection, but a small amount of processing fee may apply.
Full Refund for Small Denomination Notes
The RBI has stated full amount refund for low-value notes from ₹1 to ₹20, even if they are torn. But as for ₹50, ₹100, ₹200, or ₹500 notes, the refund may be subject to some deduction in the event of an important damage.