The Reserve Bank of India has said that technical issues hindered the process of field trial of plastic bank notes of ₹10 denomination during the last fiscal.

Though the RBI issued the request for proposal and did technical evaluation, the process could not be taken further according to its annual report. However, a development tender on plastic banknotes will be considered this fiscal, it said.

The RBI has also started exploring alternatives to increase the life of a banknote and the committee comprising stakeholders and research set up for this is likely to complete its study in this fiscal.

The Bank Note Paper Mill India Pvt Ltd (BNPMIPL) in Mysore, with a capacity of 12,000 tonnes per annum is likely to commence production this fiscal. This would lead to self-sufficiency in manufacturing of paper for banknotes, substantially reducing imports, RBI said.

The RBI will rationalise the scheme of incentives and penalties for banks for provision of banknotes and coin related services. The distribution network of banknotes and coins will be strengthened by encouraging alternate means, including leveraging technology.

Note refund rules last reviewed in 2009, will be refined further and the RBI will continue with its medium/long term objective of indigenisation of security features for Indian banknotes.

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