Prime Minister Narendra Modi, in a sudden address to the nation, announced that Rs 500 and Rs 1,000 denomination notes are being withdrawn from midnight. He said that such notes will become “mere paper”
What to Do with 500 and 1000 notes from now
To stop the spread of counterfeit notes, which is aiding terror activities from across the border, the government has decided to scrap the notes of Rs 500 and Rs 1000, Prime Minister Narendra Modi said today. Starting midnight, these notes will only be “worth the paper they are printed on,” he said.
A proposal for new Rs 500 and Rs 2,000 notes has been cleared by the Reserve Bank of India.
There will be no change in any other form of monetary exchange — cheque, DD, payment via credit or debit cards, he said.
Here’s what you need to do with your Rs 500 and Rs 1000 notes.
- Deposit them at the bank or post office from November 10 to December 30
- Exchange them from a bank or post office till 24 November. The limit for exchange is Rs 4000
- Take Aadhaar card and Pan Card when you go to exchange notes
- After December 30, these can be deposited at the Reserve Bank with a declaration
- Tourists can change the notes at airports
Your Rs 500 and Rs 1000 notes be accepted till November 11 at:
- Petrol Pumps and government hospitals
- Railway, airline, government bus ticket booking counters
- Consumer co-operative stores run by state or central government
- Milk booths authorized by state governments
- Crematoriums and burial grounds
Account holders can deposit Rs500 and Rs1000 notes in banks and post offices over the next 50 days with proof of identification such as a PAN card or an Aadhaar card. ATMs in India won’t operate on Nov. 09 and Nov. 10 to facilitate the replacement process. Banks will also remain closed to the public on Nov. 09.
This is, so far, the biggest move made by the Modi government to stop the circulation of illegal currency in the country, which was part of the Bharatiya Janata Party’s poll manifesto in 2014. Earlier in his term, Modi had opened up an amnesty scheme, allowing people to declare their illegal wealth by Sept. 30 2016, in order to avoid legal action. By Oct. 01, only some Rs65,250 crore worth of black money was declared under this scheme.
How to use 500 and 1000 notes in 2017
The prime minister also emphasised on Nov. 08 that the sudden move will impact the financing of terrorist activities in India, which often uses counterfeit notes and black money channels.
“The Rs500 and Rs1000 notes hoarded by anti-national, antisocial elements will become worthless piece of paper,” Modi said. He added, for the benefit of the public, “There is no need for panic. Your money will remain yours.”
Currently India’s black money economy is about 20% of its GDP, according to estimates from Ambit Research. Apart from cash, Indians also hoard wealth worth over billions of dollars in the form of gold