World of Coins

Adjacent hobbies => Collecting banknotes => Indian subcontinent => Topic started by: Bimat on April 09, 2019, 05:20:37 PM

Title: RBI Issues New Norms for Currency Chests
Post by: Bimat on April 09, 2019, 05:20:37 PM
How should banks keep currency notes in safe custody? RBI issues new norms

Updated: 09 Apr 2019, 10:10 AM IST

MUMBAI: The Reserve Bank of India (RBI) has come out with guidelines for banks to set up new currency chests, which include minimum area of 1,500 square feet for strong room.

"Area of the strong room/ vault of at least 1,500 sq ft. For those situated in hilly/ inaccessible places, the strong room/ vault area of at least 600 sq ft," the RBI said while specifying minimum standards for setting up new currency chests.

Besides, the new chests should have a processing capacity of 6.6 lakh pieces of banknotes per day.

For those situated in the hilly/ inaccessible places, capacity of 2.1 lakh pieces of banknotes per day.

Earlier, a RBI appointed committee had recommended that the apex bank should encourage banks to open large currency chests with modern facilities and Chest Balance Limit (CBL) of at least ₹1,000 crore.

The central bank further said the currency chests should have CBL of ₹1,000 crore, subject to ground realities and reasonable restrictions, at the discretion of the Reserve Bank.

As per the RBI's annual report of 2017-18, the currency management infrastructure consists of a network of 19 issue offices of the Reserve Bank, 3,975 currency chest and 3,654 small coin depots of commercial, co-operative and regional rural banks spread across the country.

Source: Live Mint (https://www.livemint.com/)
Title: Re: RBI Issues New Norms for Currency Chests
Post by: Figleaf on April 16, 2019, 12:22:36 PM
Even though it's guidelines only, that's clearly over-regulating, inviting top-heavy, bureaucratic governance on the basis of figures unrelated to real local needs. If RBI believes detailing rules is necessary, it should have been in the form of what RBI expects in the way of coins and banknotes going in and out, leaving it to the bank to figure out what that means in their case and to devise the most efficient way to live up to RBI's expectations.

Peter