Govt of India Stops Production of Coins ~ See the Reason behind the SPMCIL & RBI’s Move:
The Government of India has taken the decision to stop production of Coins due to lack of storage across the all four mints as per the reports. The RBI after the review of supply and usage of coins informed the Department of Economic Affairs (DEA), which then communicates with SPMCIL & now the decision has been taken to stop Production of RS 1,2,5 & 10 coins from immediate effect.
The Reserve Bank of India by releasing new directives received from State-run Security Printing and Minting Corporation of India Ltd has stated to stop the Coins Production in Mints of usually circulated Coins of R-1,2,5 & 10 due to excess of around 2.5m Coins in Noida, Hyderabad, Kolkata & Mumbai Mints causing heavy excess of Coins & no space availability. The Government officials also stated that they ordered to stop production of coins owing to a glut in the market and lack of storage space, government sources said.
Cause Behind Coin Production Ban:
The State-run Security Printing and Minting Corporation of India Limited, which runs the mints, had in a directive said that the “production of circulation coins is being stopped with immediate effect“.
As per RBI and Government sources right now, there is no space with banks or the Reserve Bank of India to store the coins & complete excess can be seen.
India’s all four mint houses reportedly have a capacity of 9.5 billion pieces a year of Re 1, Rs 2 and Rs 5 denomination. The Mint Union is now in hope from the government to take concrete steps and pick up the manufactured coins from these storage rooms and circulate them in the Country.
RBI on Coin Production & Space Availability:
RBI sources said the calibration of coin production was necessary at this time and after the assessment of the coins in circulation and storage space this Decision has been taken.
- RBI pick the currency coins from the Mints and circulates in the market but at present there are no space available there and this put the concern and by the effect RBI issued the directory to stop
- The mints will continue to function during normal working hours “without any overtime for staff”.
About Govt of India Mints:
Under The Coinage Act, 1906, the Government of India is charged with the production and supply of coins to the Reserve Bank of India(RBI). The minting of coins take place at four mints at Mumbai, Kolkata and Hyderabad . The Reserve Bank of India (RBI) picks up the coins from the mints for circulation in the market.
Reason behind Coin Production Closure:
As per the reports the banks have run out of storage space & are not in the state to retain newly produced coins before circulation. The cause behind the storage non availability seemed is Junked Banknotes deposited following the demonetization.
These are the temporary steps and it doesn’t mean that in future there will be a ban on production of Coins.
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