India to introduce plastic currency notes in next financial year

The circulation of plastic currency notes is set to begin in the next financial year, as confirmed by the Reserve Bank of India's governor following a recent policy meeting. The government has greenlit the RBI's proposal for field trials, with the procurement of these polymer banknotes currently underway. However, specific details regarding the launch date and associated costs remain undisclosed.

During a press conference following last week’s Monetary Policy Committee (MPC) meeting, Reserve Bank of India (RBI) governor Sanjay Malhotra announced that the currency notes made of plastic polymer will start circulating from the next financial year. He mentioned the proposal is still in the pilot phase, but didn’t specify a month or date for the launch of these plastic notes.

Neeraj Shekhar, member of Parliament, Rajya Sabha, raised the question about the timeframe for the introduction of the polymer currency notes in Parliament on Tuesday (August 11, 2026). He asked whether the government/RBI plans to roll out the plastic money, and if yes, what could the timeline be.

In response to Shekhar’s question, Nirmala Sitharaman, Minister of Finance, said that the RBI had sent a proposal to the government for introducing one billion pieces each of Rs 10 and Rs 20 polymer banknotes for field trials, with plans for regular issuance of polymer banknotes in these two denominations following successful trials.

“The proposal has been approved by the government. As per the RBI, these polymer banknotes are proposed to be issued along with paper substrate-based banknotes,” said Sitharaman.

The finance minister also said that the procurement of plastic notes is at an initial stage and it won’t be possible to announce a launch date.

“The RBI has informed that the procurement process is presently at an initial stage. Therefore, at this point of time, it would not be possible to practicably determine the exact timeframe for the introduction of polymer banknotes or the expenditure likely to be incurred thereon,” says Sitharaman.

After the MPC, Malhotra had that the RBI would test, check as to how polymer currency notes perform in Indian climate conditions and other infrastructure that the central bank has put in place.

"Thereafter, we will see if we need to further scale it up as it is or with changes,” the RBI governor said.

Malhotra said that if everything goes as planned, the RBI is targeting for polymer notes in circulation by the beginning of the next financial year.

Plastic polymer notes are banknotes made from a thin, flexible synthetic plastic material instead of traditional cotton paper. These polymer notes feel and fold much like paper notes, but last two to four times longer. Polymer notes can resist water and dirt and may contain advanced transparent security windows.

Polymer notes were first introduced in Australia in 1988. New Zealand followed in Australia's footsteps, while Romania became the first country in Europe to issue such notes.

Russia, China, Canada, Saudi Arabia, Kuwait and Taiwan are some other countries that use or have had polymer currency notes.