It is heart-breaking to hear that two hours from now, your bank balance owes no value. It can be shocking and can make anyone feel helpless. On November 8, 2016, the Reserve Bank of India (RBI) notified that The Mahatma Gandhi series of Rs 1000 and Rs 500 notes are invalid after midnight. The notes won’t be valid from December 30, 2016, which was the last date of exchanging old Rs 500 and 1000 Rs note. In this article, we have summoned the way-outs to generally exchange the notes that can be soiled, damaged, old, torn, or burnt. We have the topics which might help to come out of the trouble and handle the situation well.
Formalities Before Exchanging Old Notes
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Initially, when the legal tender was released in 2018, few formalities were a must. Before exchanging a note of and exceeding Rs. 500, it was necessary to visit the bank and fill up a form as a record.
For Exchanging Old Notes, There Are Certain Steps That The Bank Wants Its Customers To Go Through, Which Are As Follows:
1) Be Cautious:
Mention relevant detail. Be careful to mention the purpose, which is exchanging old notes. While confirming your ID and photocopy, don’t skip to mention the date and mention the purpose. Taking this precautionary measure will disable any outsider from misusing your ID details, and thus, your money will be safe.
2) Requisition Slip:
With the help of requisition slips, you get the validation to interchange your high-value notes of 500 or 1,000. The requisition slip of exchanging old notes requires few details. It involves a clear record of the number of each note exchanged (number of 500/- old note, 1000/- old note, and total net value in words). It also wants the customer to prove their Indian Citizenship by providing their Adhaar number, Pan card number, Voter ID card, Driving license, and other similar.
3) A Valid Proof:
A valid ID proof means your ID should be verified and updated. Don’t forget to carry a photocopy of each of the Ids (Adhaar, PAN card, Driving license, passport, Voter card, NREGA card, or any government-issued ID) with you.
How To Exchange Torn Notes From Nearby ATM?
Long story short: Such notes can be exchanged from any public sector bank nearby. However, the serial number of the torn notes must stay intact and link with the torn pieces.
But, there are a few categories of un-usable notes:
a. Condition Of The Notes:
As per RBI instructions, every bank must accept the invalid notes. It has simplified the matter by categorizing the condition of the notes into spoiled notes, brittle notes, extremely soiled or mutilated notes.
Dirty and minimally torn notes fall under the spoiled notes category. If the amount (say, Rs. 20) is slightly faded or has a cut or hole, it is a spoiled one. You can exchange these damaged notes at any public bank. It is so flexible that you need not go for any paperwork or form fill-up even. You will receive the full value of your spoiled notes.
b. Mutilated Notes:
Notes which have a significant part missing belong to this category. These notes have essential parts missing, for example, the Ashoka Pillar, RBI name, signature, Mahatma Gandhi’s portrait, etc. In such cases, the refund value is decided by RBI rules. If the torn note worth less than Rs. 50, you can get the guarantee of full payback. In case when the amount exceeds Rs. 50, and if any of the notes is torn into two pieces, then the full value will be refunded.
c. Imperfect Notes (Excessively Brittle Notes):
Notes that are torn and damaged (which aren’t usable) only have to deal with the RBI office exchange.
Extreme Cases: When Can You Not Change The Notes?
There are cases when you cannot change the invalid notes. As per the rules, if the note is torn, burnt, or has anything written to it, your note cannot be exchanged. Neither the bank nor any government office will accept or exchange them.
For notes which are cut or taped, no bank will accept their exchange.
Where Can You Change The Notes?
A one-word answer: Banks, be it a private or a public bank; they are ready to accept the tampered notes and give you cash in return. You can show up with vandalized, imperfect, or spoiled notes to your nearest banks and exchange cash. No matter even if you are not a regular or official customer of the bank, you can exchange old notes across the country. No bank will charge any amount for the facility.
How Can You Change The Old Notes?
a. Pay Bills To Any Government Sector:
That queue for ATMs after 8 pm that night is unforgettable. When most of us were busy finding a way out of the situation, there was a point which we all missed. Our due taxes, payments can be paid at banks using old currency. For example, if your electricity bill, road tax, house and water tax is unpaid, visit the nearest bank and pay the dues. Both the problems of payment and exchange will be solved at once.
b. Exchange Within 30 Days:
In case of exchanging amount worth Rs. 5000 (or more), the bank is unable to refund immediately. Instead, the bank would provide
its customers with a receipt and credit customers within 30 days. For higher amounts, the local bank might redirect their customers to a chest bank, which is authorized by the Reserve Bank of India.
Is It Valid For NRIs To Interchange Old Notes?
Rules For An NRI To Exchange Spoiled Notes:
NRIs or the Non-Resident Indians were eligible for spoiled or old note interchange till June 30, 2017.
For an NRI, the rate of exchange is Rs. 9 for every Rs. 100. So, if you’re giving 1 lakh rupees in spoiled or damaged notes, you can get 9,000 rupees in new notes. Now the question arises why would someone exchange Rs. 1crore and get 9 lakh in return. It is believed that this rule was established, especially for the NRIs as most of them don’t want the government to know their real source of income. Most of them prefer to keep their income source undeclared in front of the tax authorities.
The exchange limit in the case of NRIs, according to FEMA regulations (Foreign Exchange Management Act) is Rs 25,000 each person. Unfortunately, in 2020, no NRI is allowed to exchange their old notes. Keeping the old notes after such a long time is taken as a punishable offense.
New Rules Of RBI For The Interchange Of Spoiled Or Old Notes Of Rs 200 And Rs 2000:
As per RBI guidelines published in 2018, Rs 200 or Rs 2000 notes would be accepted for an exchange. If the note is spoiled or slightly torn, you will get the full price for the exchange. But, if the note is highly damaged, it might affect the price return. In case the note has extreme damage, there are high chances you might not get any amount at all.
According To RBI’s New Laws, The Extent Of Tear Of The Note Decides Its Rate Of The Interchange:
- In case of a 200 Rs note, the least damaged area should be 78 sq.cm for a full value refund.
- If the least unspoiled area in 39 sq.cm, a half value refund will be given.
- For Rs. 2000 full value refund, the least damaged area must be of 88 sq.cm.
- If the damage comprises the least, about 44 sq.cm, the note’s half value will be refunded.
Refund Scheme Or A Full-On Exchanging Notes:
The revised rules of RBI aims in the ceremonial exchange of mutilated notes. Irrespective of the location, every bank is abided to exchange notes to the citizens.
Salient Features Of Refund Rules
The characteristics of Refund Rules are stated below –
- All spoiled notes can be refunded at any branch of all the banks. If two torn pieces of the same note are pasted together, it is also a spoiled note. You will receive a full refund to that.
- If one part of a torn note is missing, it is a mutilated note, and for exchanging such kind of a note, there are specific rules.
Rules May Vary Depending On The Condition Of A Particular Note:
i. If 50% of the note is intact, you get the eligibility for a full payback. If the missing torn piece exceeds 50% of the total area, there will be no refund.
ii. For 50 Rs. Note or above; the half value will be given if the undivided piece ranges between 40% to 80% of the real note. If it’s 40% or less torn, you won’t receive anything.
iii. Full value return will be given when the single largest undivided part will exceed 80%. In case the note is torn into two pieces, each piece must have 40% or more area of each piece.
iv. If the note is shrunk, washed out, or unreadable, it falls under the Imperfect note category.
v. If the note is entirely unusable, you will be paid half/zero value. If the bank is satisfied with the note’s condition, you will get the deserved value. In both cases, the decision of the bank is final.
vi. If a mutilated note is joined with a mutilated piece of another note, it makes a mismatched note.
vii. These notes are determined by the number and signature of the two different pieces.
viii. In such cases, the larger piece will be considered, and the smaller will be ignored.
ix. The larger piece will fall under the mutilated note category.
x. If both the areas are unidentifiable, you will not get a refund.
Frequently Asked Questions
1. Is there any means how I can alter my old 500 rupee notes?
Be aware– You need to submit a copy of your ID proof, which might be Aadhar card, etc. to the bank. However, sternly make sure that the purpose of submission is to interchange your soiled notes with new ones. Added to that keep a note that your ID proof is not mishandled by anyone else.
Authentic ID proof– Be it your PAN card or Aadhar card or Driving license, you must keep an authentic ID proof in your pocket. However, the proof that you’re must be registered by the government else it won’t get acceptance.
Slip of requisition– It’s mandatory for you to fill for old notes exchange.
Interchanging soiled notes– It’s not mandatory for you to visit only your branch bank where you’ve made your account for the exchange. If the amount is less than 4,000, you can easily get it exchanged in any bank. However, you must carry you authenticate ID proof. Again after 15 days, you can exchange another Rs. 4,000
2. What type of notes get interchanged in banks?
a.Soiled notes
The notes that lose their color and get nasty after a period. Apart from that there are even notes that sometimes people try to join with cello tapes. Such notes are soiled or damaged notes. However, nothing to worry about these notes. You won’t lose your money. These notes are easily accepted or changed in banks. You will get the entire amount credited in your account with interchange.
b.Mutilated/torn notes
If your note is torn into two or more pieces, it’s a mutilated note. However, there are certain conditions that get applied. If your 1and 20 rupees note is 50% or more present, you get the exact amount credited in your account. Unfortunately, if more than 50% is absent, you won’t get anything in return.
For notes above Rs. 20, make sure your area of note in your hand is more than 80%. If not then forget getting the same amount in your account. You’ll lose the amount if the area of 80% or more of the note is lost.
For 40-80% of the note, you get 50% of the amount. But, if it is less than 40%, forget any exchange amount. You won’t get any return.
c.Burnt notes
Mark your notes, if they’re entirely burnt, you won’t get any refund in the regional branch banks. However, you can interchange them in the RBI issuing office.
d.Soiled notes
The notes that lose their color and get nasty after a period. Apart from that, there are even notes that sometimes people try to join with cello tapes. Such notes are soiled or damaged notes. However, nothing to worry about these notes. You won’t lose your money. These notes are easily accepted or changed in banks. You will get the entire amount credited in your account with interchange.
Mutilated/torn notes
If your note is torn into two or more pieces, it’s a mutilated note. However, there are certain conditions that get applied. If your 1and 20 rupees note is 50% or more present, you get the exact amount credited in your account. Unfortunately, if more than 50% is absent, you won’t get anything in return.
For notes above Rs. 20, make sure your area of note in your hand is more than 80%. If not then forget getting the same amount in your account. You’ll lose the amount if the area of 80% or more of the note is lost.
For 40-80% of the note, you get 50% of the amount. But, if it is less than 40%, forget any exchange amount. You won’t get any return.
e.Burnt notes
Mark your notes, if they’re entirely burnt, you won’t get any refund in the regional branch banks. However, you can interchange them in the RBI issuing office.
3. How can I interchange old damaged notes in 2020? Latest refund rules.
The last update from RBI was in 2019. They said that only NRIs will get a fair chance to exchange their old invalid currency at five RBI offices across India – Delhi, Mumbai, Chennai, Nagpur, and Kolkata till June 30, 2019.
The government has given enough time to its citizens to exchange demonetization notes. Unfortunately, the window to exchange the old 500 and 100 rs note is over in 2020.
As per the analysis, the ban of 500 rupees and 1000 rupee notes were worth 15.44tn of the total rupees. The sole purpose of the Indian rupee ban by PM Narendra Modi was to target the black money aka unaccounted wealth. The prime minister targeted as this money was earned illegally and taxes were not paid.
Final Talk
Now, you have all the information about the exchange of old notes. So, next time you face a problem of spoiled notes. You know what the solution is.
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