Have you wondered how the calculation is performed for how many Currency notes to be printed, This article elucidates this query briefly? Before going into process evaluation we should know some basic terms below
Mutilated & Soiled Note
Soiled Note
Soiled Note:-Dirty Note & note which has 2 parts of the same currency note joined with a tape.
Mutilated note:- Note which has more than 2 parts joined or has a missing portion
Mutilated & Soiled notes are unfit for circulation and it is incinerated at RBI under strict Guidelines & it is replaced with new Currency notes
Evaluating how much currency note to be printed
· According to the present GDP, the Growth rate of GDP, inflation & Deflation rate, the demand (D) of Currency notes are calculated.
· Currency note that is already Circulated in the Economy. This is calculated from the Note stock Account from RBI & Banks (N).
· Value of Mutilated & Soiled Notes Incinerated at RBI (R).
Total no of Required Notes (T):- D+R-N
In India extra 5% of currency, the note is printed by RBI as an Emergency Measure.
