Rs 10000 note was once used in India, it was banned 46 years ago due to…

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On January 16, 1978, the Janata Party-led government demonetized ₹1,000, ₹5,000, and ₹10,000 banknotes. Know the reason here.

New Delhi: Money—whether referred to as paisa, currency, or notes—is one of the most significant elements in a person’s life. It can buy you things, bring you happiness, and provide a comfortable lifestyle. Indeed, it is often regarded as one of the most respected entities in the world. From fulfilling basic needs to enabling luxury experiences, money plays a crucial role in shaping our lives and aspirations. But what if the government demonetise the note? Well, demonetisation can have significant impacts on individuals and the economy as a whole.

The story will take back to 1978, i.e. Independent India. On January 16, 1978, the Janata Party-led government demonetized ₹1,000, ₹5,000, and ₹10,000 banknotes to eliminate black money. During that time, these high-value notes were not commonly used by the general public; instead, they were primarily utilized for large transactions in trade or, more troublingly, in black-market activities.

The initiative, led by then Prime Minister Morarji Desai, aimed to combat financial malpractice and reduce the illegal use of large sums of money. However, the impact of this demonetization was relatively minimal. According to data from the Reserve Bank of India(RBI), the total amount of cash in circulation was ₹7,144 crore as of March 31, 1976.

Of this amount, ₹1,000 notes constituted ₹87.91 crore, accounting for just 1.2% of the total cash in circulation. The ₹5,000 notes comprised ₹22.90 crore, while the ₹10,000 notes, of which only 1,260 existed, were valued at ₹1.26 crore. Together, these high-denomination notes represented less than 2% of the overall currency in circulation.

Rs 10,000 Notes Journey From Pre-Independence to Independence

In 1938, the Reserve Bank of India (RBI) introduced the first ₹10,000 note, marking it as the largest denomination ever circulated in the country. This note was primarily utilized by businesses and traders for high-value transactions, as ordinary citizens seldom dealt with such large sums of money.

However, in January 1946, the British government decided to demonetize the ₹10,000 note in an effort to combat hoarding and curb black-market activities that had surged during World War II. Despite this initial move, the ₹10,000 note was reintroduced in 1954 and continued to circulate alongside other large denominations, such as the ₹5,000 note.

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