RBI plays a major role in currency management in India as outlined in various sections of the Reserve Bank of India Act.
A symbol of faith and economic power, the Indian rupee is not only a medium of exchange but also a marvel of sophisticated craftsmanship. While they appear to be ordinary paper, Indian currency notes are made of a unique blend of materials that ensure durability, security and resistance to counterfeiting.
What is currency paper made of?
Currently the paper used for printing bank notes in India is made using 100% cotton.
Designation of currency paper
Unlike normal paper, which is mainly made from wood pulp, Indian currency paper contains cotton. This composition gives the notes their unique texture, longevity and resistance to tearing. The Reserve Bank of India (RBI) ensures that the material is of high quality for repeated handling, folding and exposure to various elements.
Why Cotton Based Currency?
Cotton fibers make currency paper:
- Durable: Indian banknotes can withstand rough use and remain intact for a long time.
- Eco-friendly: Being cotton-based, notes are biodegradable, reducing the environmental impact when discarded.
- Secure: Unique texture makes forgery more challenging, adding an extra layer of security.
Special features in currency paper
Indian currency notes incorporate several security features to help distinguish genuine from counterfeit notes. This includes:
- Silver-colored security thread: A machine-readable thread embedded in the note.
- RBI Seal and Governor’s Signature: Official marks for authenticity.
- See-through register: A design element that is perfectly aligned when held up to light.
- Watermarks and Electrotype Watermarks: Visible when the note is held up to light.
- Micro letter: Small inscription visible under magnification.
- Latent Image: A hidden design is visible only when viewed at an angle.
Additionally, the digits on the note are printed with color-shifting ink, appearing green when viewed flat and changing to blue when tilted.
Interestingly, other countries also use cotton-based materials for their currency. In the United States, for example, banknotes are made of 25% linen and 75% cotton. This special paper for the Bureau of Engraving and Printing is produced exclusively by Crane Currency in Dalton, Massachusetts, with access strictly restricted to ensure security.
A symbol of trust
Indian currency notes are not just instruments of financial transactions; They are carriers of history, security and innovation. The choice of materials and strict manufacturing processes underline the effort put into creating each rupee note, reflecting the pride and confidence placed in India’s economy.
Role of Reserve Bank of India in Currency Management
RBI plays a major role in currency management in India as outlined in various sections of the Reserve Bank of India Act.
Issuance of Banknotes:
Under Section 22 of the Act, the RBI has the exclusive right to issue banknotes in India. The design, form and content of these banknotes are finalized by the Central Government after considering the recommendations of the Central Board of RBI as per Section 25 of the Act.
Planning and Supply:
RBI estimates the annual requirement for banknotes, disaggregated by denominations, in consultation with the central government and other stakeholders. He places an order with a currency printing press for their production.
Quality Assurance:
As part of its “Clean Note Policy”, RBI ensures circulation of good-quality banknotes. Notes recovered from public currency are carefully inspected. Those deemed fit are reissued, while soiled or damaged notes are destroyed to maintain the overall quality of the currency. in use
Role in coins:
RBI’s involvement with coins is limited to their distribution. The design and minting of coins in various denominations is regulated by the Government of India under the Coinage Act, 2011.
Through these measures, the RBI ensures a robust and secure currency management system, which contributes to public confidence in the financial infrastructure.
What to do if you find a fake note?
If you suspect that a currency note in your possession is fake, take the following steps immediately:
Notify the authorities: Visit the nearest police station or bank branch to report the incident. Share all relevant details, such as the time, location and description of the person or source from whom you received the note.
Inform your bank: If a fake note is dispensed by an ATM, notify your bank immediately. They can guide you on next steps or investigate the matter further.
Avoid using or attempting to pass counterfeit notes, as doing so is illegal. Instead, let the authorities handle the situation to prevent the circulation of fake currency.