Currency chest Presented by: Ravish prakash (40)
Agencies Involved in currency flow MOF Railways
Police
RBI
RBI's Presses
Govt Presses
Mints
Banks (chests)
Flow of Notes & Coins NOTES
Public
COINS
Chest branches
Chest branches & RBI Offices
Public RBI Offices
Presses
4 mint-linked RBI Offices
4 Mints
Network of Currency Chests • RBI is located only in 18 places for currency operations • Distribution of notes and coins throughout the country is done through designated bank branches, called chests • Chest is a receptacle in a commercial bank to store notes and coins on behalf of the Reserve Bank • Deposit into chest leads to credit of the commercial bank’s account and withdrawal, debit
More on Currency Chest • Meets currency requirement of public • Withdraws unfit notes • Exchange facility from one denomination to another • Payment requirement of the Government • Exchange of mutilated notes • Avoids frequent movement of cash • Chest branch operates
Currency Chest Mechanism •
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Net deposit /withdrawal of notes and coins at the chest is reported on daily basis to parent Issue Office Overall deposit or withdrawal leads to credit or debit of bank’s account in RBI Net withdrawal from chests means expansion of currency and deposits means contraction Notes in circulation being the liability of RBI, it adjusts its assetliability position centrally for such expansion or contraction
Movement of Treasure • Specially built trucks for short distance (journey completed during the day) • Railways for long distance • Guarded by police • Remittance accompanied by officials of RBI to chests • Further movement from chest to a branch done by the bank concerned
How much to print & mint • • • •
Incremental needs Replacement needs Reserve Needs Statistical analysis and long-term forecast • Printing/minting allocated between the presses/mints and delivery schedule decided in advance
Capacity of Presses & Mints • Total annual capacity of Presses: 18 bn • Can print up to 28 bn with two shifts • Total minting capacity: 4,700 mn • RBI’s annual needs: – Notes: – Coins:
about 12,000 mn pieces about 5,000 mn pieces
Cross-movement of Currency Chandigarh
Noida New Delhi Jaipur
Lucknow
Guw ahati Kanpur Bhopal Aham adabad
Patna Salboni
Dew as
Calcutta Calcutta Nagpur Mum bai
Nasik
Bhuaneshw ar
Mum bai Byculla
Hyderabad
Hyderabad
Mysore
Banglore
Chennai
Trivandrum
Fresh Notes/Coins from Press/Mint pass Press on to the banks/public only through RBI Mint Issue Offices offices – hence crossmovement
Challenges of Distribution • Size of the country and volume of currency • Security and availability of railway wagons when required • Political boundaries defining jurisdiction of Issue Offices lead to sub-optimal logistics • Cross movement of currency is unavoidable
Challenges of Distribution (contd) • Security- police is preoccupied with other activities of priority • Private security is unavailable and not favoured • Transport through railways involves enormous coordination of logistics • Privatization of transport – introduced recently in respect of coins only
Meeting the challenge of distribution
• The volume should be contained within sustainable levels by
– Shift in printing from lower to next higher denominations (a perceptible shift already visible) – Coinise Rs.10 denomination – Try out other substrate for printing – coating of paper or polymer, although currently there is no plan to introduce polymer notes.
• Banks have been compelled to dispense with the age-old practice of stapling of notes • Sorting of notes to get decentralized through banks or processing centres
Thank you……..