What changed
The previous master circular (July 1, 2020) was updated to include instructions issued up to April 1, 2021. The new circular consolidates all operational directives on counterfeit note detection and impounding.
What it means for you
Banks must ensure all counter and bulk tenders are machine-verified for authenticity. Counterfeit notes must be stamped, impounded, and never returned to the tenderer. Failure to impound will be treated as wilful involvement in circulating fakes, attracting penalties.
What you must do
- Install and maintain note authentication machines at all counters and back offices.
- Train staff to detect and impound counterfeit notes using prescribed formats.
- Issue acknowledgement receipts to tenderers for impounded notes, even if they refuse to sign.
- Report detections to police: consolidated monthly for up to 4 notes, immediate for 5 or more.
- Designate a nodal officer and set up a Forged Notes Vigilance Cell at head office.
Who it affects
All scheduled commercial banks, Cooperative banks, Regional rural banks, Treasuries and sub-treasuries, RBI issue offices
What happens if a bank fails to impound a counterfeit note?
RBI considers this wilful involvement in circulating counterfeit notes and will impose penalties on the bank.
How should banks report counterfeit note detections to police?
For up to 4 notes in a single transaction, send a consolidated monthly report. For 5 or more notes, report immediately to the nodal police station.