Question

The responsibility for printing currency notes in India lies in the hand of

1. Ministry of Finance
2. Prime Minister's office
3. Reserve Bank of India
4. State Bank of India

Answer 1

Correct Answer - Option 3 : Reserve Bank of India

The correct answer is the Reserve Bank of India.

• In terms of Section 22 of the Act, Reserve Bank has the sole right to issue banknotes in India.
• Section 25 states that the design, form and material of bank notes shall be such as may be approved by the Central Government after consideration of the recommendations made by the Central Board of RBI.
• It estimates the number of banknotes that are likely to be needed denomination-wise in a year and places indents with the various currency printing presses for the supply of banknotes.
• The Reserve Bank in terms of its clean note policy provides good quality banknotes to the members of the public
• With this objective in view the banknotes received back from circulation are examined and those fit for circulation are reissued while the others (soiled and mutilated) are destroyed to maintain the quality of banknotes in circulation.
• In respect of coins, the role of RBI is limited to the distribution of coins that are supplied by the Government of India.
• The Government of India is responsible for the designing and minting of coins in various denominations as per the Coinage Act, 2011.