Banks in the country are scrambling to stay afloat amid the global financial crisis and are looking to take advantage of the fact that their money is mostly fungible, not linked to one particular person.
They are now finding ways to circumvent the risks of bank collapses and to make their money fungible.
With the country’s central bank holding over Rs 1,500 crore in cash and reserves, the central bank has to keep a tight rein on cashflow, particularly as the economy struggles to recover from the financial crisis.
The central bank is also trying to boost the countrys economy through an ambitious plan to make banking more convenient.
In the first half of this year, banks in the nation’s capital have already reported that they have taken advantage of more than 2,000 of the more than 20,000 transactions they have processed over the past year, according to data from the Indian Payments Council.
The banknotes, which are made from plastic and come in denominations of Rs 500, Rs 1 and Rs 10, are also used as currency in a wide range of sectors, including food, beverage, auto, health, construction and retail.
In an effort to avoid a bank collapse, many banks are now introducing new types of notes with different designs to help their customers make transactions.
They include banknotes made of plastic, like the Rs 500 and Rs 1 note, as well as the polymer banknote, which can be made from polymer.
These plastic banknotes are not only cheaper than the metal banknotes but also do not require any central bank to process them, said Rajiv Mehta, president of Indian Payments Corporation.
They have a different design and are more convenient, he said.
These are notes that are much cheaper to make and require no bank to issue the banknotes.
They can be deposited electronically in bank branches, and have lower transaction costs.
In the past, banknotes were used as a medium of exchange, but now they are being used as payment instruments, said Mehtas.
A major concern for the government and the banks is that India’s economy has been hit hard by the crisis and the central government is struggling to meet its deficit targets.
The government has said it needs at least Rs 100 billion by March 2019 to address the debt, but the banks have warned the central banks are likely to have to make even larger sacrifices if they are to avoid bank failures.
The Reserve Bank of India (RBI) has already announced plans to spend Rs 100 crore to provide more than 10,000 more banks with cash in the first six months of the year.
This is expected to cover the cost of new branch openings in some states, including Punjab, Maharashtra and Delhi.