What are the Benefits of Plastic Notes in the Indian Economy?

The Reserve Bank of India, the country’s central bank, has chosen to test the circulation of plastic notes of Rs. 10 denomination in five cities: Mysore, Kochi, Jaipur, Shimla, and Bhubaneswar, to combat the country’s parallel economy and rising currency production costs. Around one billion plastic Rs. Ten notes will be made for this project. It’s important to understand that the Reserve Bank replaces around two lakh crores in outdated ripped-off notes each year.

In 1988, Australia became the first country to adopt plastic notes. The Reserve Bank of Australia, the University of Melbourne, and the Commonwealth Scientific and Industrial Council are commonly credited for inventing plastic money notes (CSIC). As a consequence of the favourable outcomes of the testing, a large number of plastic notes were distributed around the country in 1996.

Many nations now print plastic currency. 

When the plastic note was first introduced in Australia, it was quickly adopted by several other countries. Over 30 nations have adopted plastic money in the previous five years. The Reserve Bank of India has used this method since 2010.

Some of the advantages of utilising plastic notes are as follows:-

• The Reserve Bank of India spent Rs. 2376 crore on currency notes of different denominations during the 2012-13 fiscal year, accounting for 1.5 percent of total currency.

• The polymers in question are more durable. Watermarks, clear windows, and difficult-to-read numbers are elements that cannot be replicated in these notes.

• Paper currency notes are not as hygienic as plastic ones. Plastic notes are cleaner in comparison.

• It is easier to move plastic money notes from one location to another than to move paper money notes.

• Because plastic notes remain longer, they reduce energy use and so assist in reducing greenhouse gas emissions.

• Instead of being thrown away or burned like paper money, plastic cash notes may now be recycled into other valuable items.

• Because plastic currency notes are less likely to be touched by several individuals than paper currency notes, they are less likely to get contaminated by germs. these notes are cleaner in comparison

• The cost of making the changeover from paper money to polymer money is high, but it will be worth it in the long run.

Plastic notes in the present era 

Historically, banknotes and money notes have been made from cotton rags. An ultra-thin layer of lacquer protects the cotton-based paper from dirt and moisture. Despite their extensive usage, polymer or plastic notes are beginning to take their place.

Banknotes made of polyethylene terephthalate (PET) are more durable because of their high tear and folding resistance. Automatic sorting and ATMs both profit from the use of these cards. Even though they cost twice as much to create, they may survive 2.5 to 4 times longer than notes printed on cotton-based paper. In addition to being more difficult to counterfeit, polymer cash is more secure than paper money.

Mobile and plastic money use are on the increase.

 The widespread usage of mobile phones has enabled increased access to financial services in rural India. The telecom industry in India is heading toward mobile money or digital payments for the “cashless economy,” as mentioned in this article. With the aid of this study, businesses and governments may be able to better understand the adoption of digital payments. There is an increasing need for innovative mobile technology applications in rural regions in developing countries. If mobile payments become more extensively utilised, they may aid the country’s financial inclusion efforts.

The development of e-commerce is boosting global commercial attractiveness and socioeconomic advancement. In India and the countries to the south, technology is widely used. People between the ages of 25 and 35 indicate a high preference for digital money because they feel it is safe and free of fraud. According to the study’s results, small and medium-sized businesses rapidly resort to internet commerce (SMEs). Small and medium-sized enterprises (SMEs) control a significant section of the organisation, emphasising the Internet of Things (IoT). It is not a smart solution for individuals afraid of cybercrime and who do not want to take any risks. This kind of research might be beneficial to various types of online system channels.

Conclusion

Despite the inconvenience and effort it takes to recycle plastic, it is the best solution, and plastic notes are cleaner in comparison. Even though plastic manufacturing is unregulated, there are few recycling facilities. We must cross this enormous chasm to get to the other side. An international study estimates that 600 billion plastic bags are used each year worldwide. Many of these bags wind up in rivers and sewers, where they clog and ultimately end up in our oceans. Plastic bags are in the top 10 of the most common types of litter found on seas and beaches worldwide. To reuse plastic, it is necessary to expand the number of available recycling facilities.