Govt 'won't stop exchange of scrapped Rs 500, 1000 notes'

New Delhi: Rejecting reports that banks would gradually stop letting people exchange scrapped notes of Rs 500, 1000, government officials said the Centre does not want to cause any panic among citizens and they can continue swapping their old currency for new ones.

According to a NDTV report, banks and government officials said reports that the Centre was planning to stop exchange of old notes to avoid misuse and would only allow public to deposit the scrapped currency were not true.

“The government does not want to send any signal which may set in panic among the public," sources told the channel.

On Friday, reports were doing the rounds that government may withdraw the exchange facility gradually and instead ask holders of old currency to deposit in their bank accounts.

Read: Govt may stop cash exchange, old notes to be deposited in bank account

According to sources, the government had allowed exchange facility in the beginning to ensure liquidity remains in the market.

"About 60 per cent of the liquidity that we wanted to maintain in the market post demonetisation has already been achieved. As and when the remaining is achieved, the exchange facility could be phased out," an official had said.

While making the demonetisation announcement on November 8, the government had said it will review the limit for cash exchange after 15 days.

Earlier reports indicated that the government is waiting for new currency to get into the system first and as and when there is near adequate circulation, the exchange facility could be withdrawn. But now, officials have clarified that there is no such plan as of now.