Government Approves RBI Trial of Polymer ₹10 and ₹20 Notes; No Plan to Drop Paper Money

The Government has approved the Reserve Bank of India's proposal to conduct field trials of polymer banknotes in the ₹10 and ₹20 denominations, as per The Economic Times news report. 

In a written reply in the Lok Sabha, Minister of State for Finance Pankaj Chaudhary said the RBI plans to print one billion polymer notes of each denomination for the trial. A decision on regular circulation will be taken only after the testing process is completed. 

Paper Notes Not Being Phased Out 

The Centre said the proposal does not involve replacing the existing paper currency system. Polymer notes, if introduced after successful trials, will be issued along with paper banknotes.  

The government said there is no proposal at present to withdraw paper-substrate currency or replace it entirely with polymer notes. 

Polymer Notes Under Evaluation 

The RBI has informed the government that studies from other countries show polymer banknotes generally remain in circulation longer than paper notes because they are more resistant to wear and damage.  

Polymer currency is already used in countries such as Australia, the United Kingdom and Canada. RBI Governor Sanjay Malhotra had earlier said discussions on introducing polymer notes were still at a preliminary stage. 

Global Suppliers Invited 

Ahead of the trials, Bharatiya Reserve Bank Note Mudran Private Limited (BRBNMPL), the RBI's currency printing subsidiary, invited global manufacturers to supply polymer substrate sheets with embedded security features.  

The tender includes security-related conditions, including government clearance for suppliers and restrictions on sourcing India-specific raw materials from China and Pakistan. BRBNMPL has indicated an initial requirement of about 68,000 reams for the proposed trial. 

Digital Payments, Cash Demand 

On questions related to digital payments, the government said it is too early to assess any impact as polymer notes have not entered regular circulation. It said cash and digital payment systems continue to complement each other.  

RBI data showed the value of currency in circulation increased 12% year-on-year to ₹41.23 lakh crore at the end of March 2026, while expenditure on currency printing declined nearly 24% to ₹4,875 crore in FY26. 

Read More: India Sets Target of 5% Global Toy Market Share by 2032! 

Conclusion 

The RBI will proceed with limited field testing of polymer ₹10 and ₹20 notes after receiving government approval. The Centre has clarified that there is no proposal to replace existing paper banknotes. 

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