BLOG 14/2026 DATED 23RD FEB 2026
Management of currency and its distribution in the economy is a herculean task for the Central Bank of a country. In India this work is undertaken by Reserve Bank of India. Let us briefly discuss the currency and then we shall move towards its flow and management.
There are two types of currencies:
Paper currency: The value of the currency is printed on a paper and the holder can transact equal to the value mentioned on the currency.
Digital Currency: Instead of paper, the currency is issued in digital form. Reserve Bank of India has started issuing digital currency called CBDC (Central Bank Digital Currency) since 2022.
In this discussion, we will restrict ourselves to the paper currency and its distribution. It should be made clear here that Digital currency is different from digital transactions. A digital transaction is backed by either digital or paper currency. For instance, an amount Rs 100/- transferred through UPI can be backed by paper currency. Only the transaction is digital and currency does not change hands. For doing transaction in digital currency, we should have digital currency app of CBDC while a UPI or mobile banking digital transaction can be done even if we do not have the digital currency in our wallet.
Currency notes in India are issued and managed by Reserve Bank of India (RBI).
Who prints/mint these notes and coins?
There are four currency presses where these notes are printed.
| Owner | Place |
| Security Printing and Minting Corporation of India Ltd (SPMCIL)- Owner Govt of India | Nasik (West) |
| Security Printing and Minting Corporation of India Ltd (SPMCIL)- Owner Govt of India | Dewas (Central) |
| Bhartiya Reserve Bank Note Mudran Private Ltd (BRBNML) – Owner RBI | Mysore (South) |
| Bhartiya Reserve Bank Note Mudran Private Ltd (BRBNML) – Owner RBI | Salboni (East) |
The paper currency issued by RBI is made of 100% cotton. Coins are minted by SPMCIL only at their four mints situated at Mumbai, Hyderabad, Kolkata and Noida.
Is the currency note backed by a value or asset?
The currency issued by RBI is not backed by any physical asset such as Gold, silver etc. However, RBI maintains sufficient balance of assets such as reserves, including Gold to maintain stability of the value of currency and as a matter of policy. Further, the currency note is a legal tender and the value is guaranteed by the Central Government.
How much currency to print?
RBI assess two factors before deciding how much currency notes to be printed; expected increase in Note In Circulation (NIC) and replacement of soiled/mutiliated notes. RBI depend upon a statistical model to arrive at these requirements. Further the final decision is taken after consultation with the Central Government.
How the currency reaches us?
Currency once printed at the currency press, is distributed to 19 issue office of RBI at various places in the country. From those 19 issue offices the new currency notes are physically delivered to the various currency chests maintained by different banks. A currency chest is an RBI office but managed by different commercial banks at different centres. From currency chest the money is sent to bank branches from where it is issued to general public.
What is currency chest?
A currency chest is an RBI office managed by different commercial banks. It is constructed with high level security features and strict security guidelines from RBI. Whenever, a bank branch has surplus cash beyond the cash limit set for that branch, it sends the currency to the currency chest. Normally a bank branch is not permitted to hold currency notes beyond a limit. The moment currency reaches the chest, RBI accounts it as balance of that bank with RBI. Whenever a bank branch require cash, it can indent from a currency chest. There are 2691 Currency Chest in the country as on 28th February 2025. There are Small Coins Depot that manages the small coins on the lines of currency chest.
These points cover only the management of physical movement of currency notes. I close the discussion with some crunchy figures.
As on 13th Feb 2026, currency in circulation is as under:
| Pieces in lakh | Value in crore | |
| Physical notes | 16,65,638 | 40,03,472 |
| E rupee | 68,892 | 689 |
| Coins | 14,26,248 | 40,368 |
Enjoy the currency quiz at RBI website. Link below.
https://indiancurrency.rbi.org.in/game
SUBSCRIBE IF IT ADDS VALUE: 1. CLICK SUBSCRIBE BUTTON 2. ENTER YOUR EMAIL ID 3. CONFIRM YOUR SUBSCRIPTION ON THE MAIL SENT TO YOU. YOU WILL START RECEIVING THE BLOGS ON YOUR MAIL.
Discover more from At Silly Point
Subscribe to get the latest posts sent to your email.