Fake Currency Recoveries Increase 5.7% During FY26
Banking sector uncovers nearly 2.3 lakh fake notes during the year, while circulation of counterfeit Rs 2,000 notes continues to shrink sharply.
NEW DELHI, May 30: Detection of counterfeit currency notes in the banking system recorded a 5.7 per cent increase during the financial year 2025-26, primarily driven by a rise in fake Rs 500 denomination notes, according to the Reserve Bank of India’s annual report released on Friday.
Banks and the RBI together identified 2,29,746 counterfeit notes during the year, compared to 2,17,396 pieces detected in 2024-25.
The Rs 500 denomination remained the most frequently counterfeited currency note, with detections rising by over 20 per cent to 1,41,907 pieces. The increase accounted for a significant share of the overall growth in fake currency cases reported during the year.
Among lower denominations, the number of forged Rs 20 notes witnessed a notable surge, climbing to 373 pieces from 253 in the previous fiscal.
In contrast, detections of counterfeit Rs 200, Rs 100 and Rs 50 notes registered a decline. Fake Rs 200 notes fell to 30,591 pieces, while counterfeit Rs 100 and Rs 50 notes dropped to 45,621 and 10,274 pieces, respectively.
The withdrawal of the Rs 2,000 denomination continued to reflect in counterfeit currency trends, with detections plunging to 824 pieces during FY26 from 3,508 a year earlier.
The RBI report noted that commercial banks accounted for the overwhelming majority of counterfeit note detections, identifying 2,24,334 pieces or 97.6 per cent of the total. The central bank detected the remaining 5,412 pieces. The figures do not include counterfeit currency seized by police or other law enforcement agencies.
Meanwhile, disposal of soiled banknotes declined substantially during the year. A total of 1.72 lakh pieces were withdrawn and processed, compared to 2.38 lakh pieces in FY25, reflecting a decline of nearly 29 per cent.
Among denominations, Rs 500 notes constituted the largest volume of soiled currency removed from circulation at 59.8 lakh pieces, although the number was significantly lower than the 89.8 lakh pieces disposed of in the previous year.
The volume of discarded Rs 20 notes also fell sharply, while disposal of Rs 100 notes remained largely unchanged from the preceding fiscal, the report said.
