NEW DELHI, July 28 — The government has approved a Reserve Bank of India proposal to conduct field trials of polymer banknotes in the ₹10 and ₹20 denominations, with one billion notes of each denomination to be issued for the trial under Section 25 of the RBI Act, 1934.
The trial, valued at roughly ₹3,000 crore, will test how polymer notes hold up under India's varied climate and heavy day-to-day handling, compared with the cotton-based paper substrate currently used for all denominations. Polymer notes are made from a non-fibrous, non-porous plastic substrate and are generally considered more durable and harder to counterfeit than paper notes, though they cost more to produce.
RBI officials clarified that the trial is exploratory and does not signal an immediate switch away from paper currency; regular issuance of polymer notes would follow only after the trial period is evaluated for durability, security performance and public acceptance. Several countries, including Australia, the UK and Canada, have already moved some or all of their currency to polymer substrates.
This is a frequently tested banking-awareness topic — aspirants should remember the enabling provision (Section 25, RBI Act 1934), the denominations under trial, and the broad rationale (durability and counterfeit resistance) behind the shift.