CLEAN NOTE POLICY
NOTE REFUND RULES
SESSION OUTLINE
CLEAN NOTE POLICY
HANDLING OF COUNTERFEIT NOTES
NOTE REFUND RULES
FACILTY FOR EXCHANGE OF NOTES & COINS
CURRENCY CHEST OPERATIONS
RBI GUIDELINES FOR LEVY OF PENAL INTEREST OR
/AND WRONG REPORTING
Objective of Clean Note Policy of RBI is to
provide good quality currency notes &
coins to general public.
It implies that that note packets are not to
be stapled with pins but are to be secured
with paper bands etc.
Writing on currency notes is also
Clean discouraged.
Note RBI has directed all banks to sort out notes
Policy into issuable and non-issuable, and issue to
the public only the clean notes.
Banks are also required to extend note
exchange facilities to public freely based
on their guidelines & note refund rules.
Similarly, the customers will tender at their
banks notes only in unstapled condition
Under the present system of mechanized
processing of banknotes, inscription or
scribbling on any part of the banknote would
render it to be classified as unfit for reissue
Clean So, dealing officers and staff to forthwith stop
Note writing / scribbling of any kind on any part of
the banknote to ensure achievement of the
Policy objectives of clean note policy
Branches will strictly follow the RBI's instructions
issued, from time to time, under the Clean
Note Policy
Bank has installed note sorting machines
capable of segregating the notes into
issuable, non-issuable and suspect
categories in all bank branches.
Note packets are to be prepared as per
Clean Note Policy of Reserve Bank of India.
Clean
The remittances of non-issuable, soiled and
Note mutilated notes are required to be sent to
RBI at regular intervals.
Policy
RBI has a scheme of incentives & penalties
for banks in this regard. It is known as the
Currency Distribution & Exchange Scheme
for rendering customer service to public.
Failure of the branch/back office/Currency Chest to
impound counterfeit notes detected at their end will be
construed as willful involvement of the receiving
Cashier/Cash officer/Joint Custodian concerned in
circulating counterfeit notes and penalty, if any imposed by
RBI will be recovered from erring employees apart from
taking action as Bank may deem fit.
With a view to facilitating the detection of counterfeit
Handling of notes, all branches/ identified back offices should be
equipped with ultra- violet lamps / other appropriate
Counterfeit banknote sorting / detection machines.
Currency
Note
The branches shall maintain a daily record of the notes
processed through the Note Sorting machines, including
the number of counterfeits detected.
It is necessary to ensure that the cash handling
staff in banks and treasuries / subtreasuries is
fully conversant with the security features of a
banknote
Handling of
Counterfeit The design and security features of all the
banknotes must be displayed prominently at
Currency the branches for information of the public
Note
Details of security features are available at the
link [Link]
Handling of Counterfeit Currency Note
Bank notes tendered over
the counter or received
Counterfeit money is imitation
directly at the back office/ Counterfeit notes shall be
currency produced without
Currency Chest through bulk impounded by all Bank
the legal sanction of the
tenders should be examined branches.
government
for authenticity through Note
Sorting Machines (NSMs).
No credit to customer’s
account is to be given for
In no case, the counterfeit
counterfeit note, if any,
notes should be returned to
detected in the tender
the tenderer or destroyed by
received at branches over
the bank branches.
the counter or at the back-
office / currency chest.
Handling of Counterfeit Currency Note
Each Bank Note which on examination of various security
features/parameters is determined as counterfeit one by the concerned
official at counter or back office/Currency Chest will be stamped as
“Counterfeit Note” with a stamp having uniform size of 5 cm X 5cm.
Each such impounded note shall be recorded under authentication, in
Forged Note Detection and Impounding Register under authentication of
cash officer and Accountant of the branch/office concerned
Issue of Receipt to tenderer
When a banknote tendered at the counter of a branch/back office or
currency chest is found to be counterfeit, an acknowledgement receipt
must be issued to tenderer in the prescribed format
The receipt in running serial number should be authenticated by receiving
official and tenderer.
The receipt is to be issued even in cases where the tenderer is unwilling to
countersign it.
Handling of Counterfeit Currency Note
Counterfeit notes so detected and impounded must be
entered on the same day in Counterfeit Currency
Reporting(CCR) portal, available in SBI Times=> More
Links=> SBI Single Sign on => Counterfeit Currency
Reporting.
Branches will report such Fake Indian Currency Notes
(FICNs) on CCR portal also which are detected by RBI in
remittances sent to them or detected during inspection
conducted by RBI
an acknowledgement receipt must be
issued to tenderer in the prescribed
format, after stamping of notes as
prescribed above. The receipt in running
serial number should be authenticated by
receiving official and tenderer. The
receipt is to be issued even in cases
where the tenderer is unwilling to
countersign it.
Issue of
Receipt
to Notice to this effect should be displayed
tenderer prominently at the offices / branches for
information of the public
Reporting to Police
For cases of detection of counterfeit notes up to 4 pieces, in a single
transaction, a consolidated branch wise report in the prescribed
format (Annex III) based on data extracted from CCR portal should be
sent by the Branch Manager to the Police Authorities or the Nodal
Police station, along with the suspect counterfeit notes, at the end of
the month.
For cases of detection of counterfeit notes of 5 or more pieces, in a
single transaction, the counterfeit notes should be forwarded by the
branch immediately to the local police authorities or the Nodal
Police Station for investigation by filing FIR in the prescribed format
(Annex IV)
Branch would also forward a copy of the format to
the Nodal Officer for information. Acknowledgement
to be obtained and kept on record.
Chief Manager (Compliance & Risk) of the
concerned RBO will act as Nodal Bank Officer for all
the districts falling under the jurisdiction of the RBO
All cases of reporting of counterfeit note detected
should be routed through the Nodal Bank Officer
only and he will be the single point of contact for all
activities related to detection, impounding and
reporting.
FILING OF However, reporting through the Nodal Bank Officer
may delay due to large number of branches in an
FIR RBO spread over districts/geographies.
Branches should, therefore, report to Police
Authorities under advice to Nodal Bank Officer to
minimize delay and ensuring better compliance
In case any difficulty is faced by the Offices/
Branches due to reluctance of the police to receive
monthly consolidated statement/ file FIRs, the
matter may be sorted out in consultation with the
Nodal Officer of the police authority designated to
coordinate matters relating to investigation of
counterfeit bank notes cases.
The list of Nodal Police Station may be obtained
from the respective Regional Office of Reserve
Reporting Bank.
to Police
A copy of the monthly consolidated report/ FIR shall
be sent to the Forged Note Vigilance Cell
constituted at LHO by the Nodal Officer
Preservation of Counterfeit Notes
received from Police Authorities
All Counterfeit Notes received back from the police
authorities/ Courts be advised to FNVC and should be
carefully preserved in the safe custody of the branch
where these were detected and a record thereof be
maintained by the branch in a separate folio in Branch
Documents Register.
Counterfeit Notes, which are the subject matter of
litigation in the court of law should be preserved by the
branch concerned for three years after conclusion of the
court case
These Counterfeit Notes at branches should be subjected
to verification on a half-yearly basis (on 31st March and
30th September) by the Branch Manager.
SOILED NOTES
MUTILATED NOTES
Reserve EXTREMELY BRITTLE
Bank of BURNT
India (Note CHARRED
Refund)
Rules, 2009 DELIBERATELY CUT NOTES
Soiled Notes- A ‘soiled note' means a note which
has become dirty due to normal wear and tear
and also includes a two-piece note pasted
together wherein both the pieces presented
belong to the same note and form the entire
note with no essential feature missing
Reserve
Bank of
These notes should be accepted over bank
India (Note counters in payment of Government dues and
Refund) for credit to accounts of the public maintained
with banks
Rules, 2009
However, in no case, these notes should be
issued to the public as re-issuable notes and shall
be deposited in currency chests for onward
transmission to RBI offices as soiled note
remittances for further processing.
EXCHANGE OF SOILED NOTES
Notes presented in small number: Where the number of notes
presented by a person is up to 20 pieces with a maximum
value of Rs.5000 per day, banks should exchange them over
the counter, free of charge.
Notes presented in bulk: Where the number of notes
presented by a person exceeds 20 pieces or Rs.5000 in value
per day, banks may accept them, against receipt, for value
to be credited later. Banks may levy service charges
In case tendered value is above Rs.50000, banks are
expected to take the usual precautions.
MUTILATED NOTES
A mutilated note is The notes so presented
a note of which a Mutilated notes shall be accepted,
portion is missing, or may be presented exchanged and
which is composed at any of the bank adjudicated in
of more than two branches. accordance with
pieces. Reserve Bank of India
(Note Refund) Rules
Notes of less than Rs.50 denomination
Full Value will be paid if the single
largest undivided piece of the
"mutilated" note is more than 50% of
the area of the respective No provisions for payment of Half
denomination. Value
NIL- if the largest undivided piece
of the damaged note is 50% or less
than the area of the original note
Notes of denomination Rs.50 or more
Zero Value : If the area of the
Half Value : If the area of the
single largest undivided
single largest undivided
piece of the mutilated note
piece is between 40% to
is less than 40% of the area of
80% of the original note
the respective denomination
Full Value : If the area of the single
largest undivided piece is more than
80%.
Full Value : If there are two pieces of
the same note and each piece has
an area of 40% or more.
After adjudicating mutilated notes, the
Prescribed Officer is required to record his
order by subscribing his initials to the dated
'PAY'/ 'PAID'/ 'REJECT' stamp.
The 'PAY' /'PAID' & 'REJECT' stamps should
also carry the name of the bank and
branch concerned and held under the
custody of the 'Prescribed Officer' to avoid
misuse. Mutilated / defective notes bearing
MUTILATED 'PAY'/'PAID’ (or 'REJECT') stamp of any RBI
Issue Office or any bank branch
NOTES
if presented for payment again at any of
the bank branches should be rejected
under Rule 6(2) of Reserve Bank of India
(Note Refund) Rules, 2009 and the tenderer
should be advised that the value of such
note/s cannot be paid since the same has
already been paid as is evident from the
PAY/PAID stamps affixed on it/them
The full value paid notes have to be remitted
by all branches to the chest branches with
which they have been linked and therefrom
to the Issue Offices concerned together with
the next soiled note remittance
The half value paid notes and rejected notes,
which are held by the chest branches in their
MUTILATED cash balance, may either be remitted
separately packed together with the full value
NOTES paid notes or sent by registered and insured
post as and when required.
The full value paid notes will be treated as
chest remittance by the Issue Office while the
half value paid notes and rejected notes will
be treated as notes tendered for adjudication
and processed accordingly
All branches of banks in all parts of the
country are mandated to provide the
following customer services:
(i) Issuing fresh / good quality notes and
coins of all denominations on demand,
Facility for (ii) Exchanging soiled
defective notes, and
/ mutilated /
exchange (iii) Accepting coins and notes either for
transactions or exchange. In terms of
of notes section 6 (1) of The Coinage Act, 2011,
and coins None of the bank branches shall refuse to
accept small denomination notes and / or coins
tendered at their counters. All coins in the
denomination of 50 paise, ₹1, ₹2, ₹5, ₹10 and
₹20 of various sizes, theme and design issued
from time to time by the Government of India
continue to be legal tender
Notes which have turned extremely brittle
or are badly burnt, charred or inseparably
stuck up together and, therefore, cannot
Extremely withstand normal handling, shall not be
Brittle, accepted by the bank branches for
exchange.
Burnt,
Charred,
Stuck-Up Instead, the holders shall be advised to
tender these notes to the Issue Office of
Notes Reserve Bank of India concerned where
they will be adjudicated under a Special
Procedure.
Cash Retention Limit
Cash held by our Non currency Chest Branches is
the property of SBI whereas cash in currency chest
branches is the property of RBI.
Cash balances at Hand Balance branches are idle
assets and have opportunity loss
Every Branch is required to maintain an optimum
cash balance at branches to meet the
requirements of customers. Any excess cash
holding beyond a limit is shifted to linked currency
chest branch/CAC.
A limit for every branch is required to be fixed. This
limit is called Cash Retention Limit.
Branches, Urban and Metro Branches serviced
by CAC/SCAB and other Branches.
Cash
Retention Insurance of Cash and other valuables “On
Premises” and “In Transit”.
Limit
Cash Retention Limit of Branches may be
reviewed in the months of May/June every year
and to make it applicable w.e.f. 1st July every
year.
Cash retention limit of branches is fixed as
under :
Cash Rural – up to Rs. 10.00 lacs**
Retention Semi-Urban – above Rs. 10.00 lacs-Rs.20.00 lacs
Limit Urban & Metro – Above Rs. 20.00 lacs.
All Branches required to pay Central Office
Interest on cash available at the Branches @9%
p.a. (Cash available at the Branch = Branch
Cash Balance + Cash Balance with SWO).
Approval of Cash Retention Limit
Cash Retention Limit Approval By
Upto ₹10 lakhs Chief Manager
(Compliance
&Operation / Chief
Manager (GB)
>₹10 lakhs & upto ₹20 lakhs Regional Manager
> ₹20 lakhs Deputy General Manager
(B&O)
THANK YOU