Plastic Currency Notes coming soon, Govt approves proposal to introduce one billion polymer notes
The Government of India has clarified that there is no proposal to replace existing paper currency with plastic (polymer) banknotes. The clarification was given by the Ministry of Finance in a written reply to an Unstarred Question in the Lok Sabha on 27 July 2026.
RBI Proposal Approved by Government
The Ministry informed Parliament that the Reserve Bank of India (RBI), with the recommendation of its Central Board, had submitted a proposal to the Government under Section 25 of the Reserve Bank of India Act, 1934.
The proposal seeks approval for the introduction of one billion polymer banknotes each in the ₹10 and ₹20 denominations for field trials. If the field trials are successful, these polymer notes may be issued regularly in the same denominations. The Government has approved this proposal.
Which countries use Paper currency?
Polymer currency notes are used in roughly 60 countries, with Australia, the United Kingdom, and Canada among the most prominent nations to adopt them. Australia was the first country to fully convert to polymer notes starting in 1988.
Australia: Entirely switched to polymer for all denominations in the 1990s.
United Kingdom: Replaced traditional paper notes with polymer for £5, £10, £20, and £50 banknotes.
Canada: Fully transitioned its standard bank notes to a durable polymer material.
Other Nations: Completely or partially switch using polymer in places like New Zealand, Vietnam, Malaysia, Singapore, Romania, and recently Oman.
Why Are Polymer Notes Being Introduced?
According to the RBI, international studies have shown that polymer banknotes have a much longer lifespan than traditional paper banknotes. Because of their durability, polymer notes are expected to remain in circulation for a longer period before they need to be replaced.
The RBI has also stated that the introduction of polymer banknotes is currently at a preliminary stage, and their overall impact can only be assessed after they are issued for regular public use.
Will Plastic Notes Affect Digital Payments?
The Government said that it is too early to determine whether polymer banknotes will have any impact on digital payment systems. The RBI believes that banknotes and digital payment systems are complementary modes of payment and both will continue to serve the public.
Will Paper Currency Be Replaced?
The Ministry has made it clear that there is no proposal to replace paper currency with polymer banknotes. According to the RBI, polymer notes will be issued alongside existing paper-based banknotes, meaning both types of currency will remain in circulation.
What This Means for the Public
For now, people can continue using existing paper currency without any concern. The proposed polymer notes are only meant for field trials in the ₹10 and ₹20 denominations. If the trials are successful, polymer notes may gradually be introduced while paper notes will continue to remain valid and circulate alongside them.
