The number of counterfeit currency notes caught by banks and the Reserve Bank of India has been increasing over the last three years. While fake Rs. 100 and Rs. 1,000 notes have surged, the number of similar five-hundred rupee notes have reduced. By contrast, only 134 counterfeit ten-rupee notes were caught in 2015-16.
Finance Ministry data presented in the Lok Sabha show that in all, 6.3 lakh counterfeit notes were detected in financial year 2015-16, up from 5.9 lakh in 2014-15 and 4.9 lakh in the year before that. In value terms, Rs. 29.6 crore worth of counterfeit notes were found in 2015-16, a rise from Rs. 28.7 crore in the previous year.
The data indicated that the banks, and the central bank, could have become better at catching counterfeit currency, or the incidence of counterfeiting had increased, or both.
Of the fake currency detected in 2015-16, 41 per cent was of Rs. 500 denomination and 35 per cent, Rs. 100. Interestingly, the absolute number of fake five-hundred rupee notes dipped in 2015-16 to 2.6 lakh from 2.7 lakh in the previous year. There was a rise, however, in counterfeit hundred and thousand-rupee notes – by 22 per cent and 9 per cent – respectively, over the same period.
Finance Ministry data also showed that the denominations that have seen the highest incidence of counterfeiting—Rs. 500 and Rs. 100—are also among the denominations most widely circulated in the economy.
There were 1,646 crore notes of Rs. 500 in circulation on April 29, 2016, followed by 1,642 crore Rs. 100 notes. The ten rupee denomination has twice as many notes in circulation—3,229 crore—but its lower face value may make it less attractive to counterfeiters.
The RBI has a host of measures to detect counterfeit currency, many of which can be adopted by the lay person. All bank notes include a watermarked Mahatma Gandhi image.
“Rs.1,000 notes introduced in October 2000 contain a readable, windowed security thread alternately visible on the obverse with the inscriptions ‘Bharat’ (in Hindi), ‘1000’ and ‘RBI’, but totally embedded on the reverse. The Rs. 500 and Rs. 100 notes have a security thread with similar visible features and inscription ‘Bharat’ (in Hindi), and ‘RBI’. When held against the light, the security thread on Rs.1,000, Rs.500 and Rs.100 can be seen as one continuous line,” the RBI website says. The Rs.5, Rs.10, Rs.20 and Rs.50 notes contain similar features.