JPCB Clean Note Policy/1

CLEAN NOTE POLICY 2023-24.

Preamble

Reserve Bank of India has been continuously making efforts to ensure supply of fresh
crispy currency notes to the public through the banks vide circular issued by them from
time to time. Banks are bound to comply with directions issued by RBI in exercise of
powers vested in it under section 21 & 35A of Banking Regulation Act 1949. Any
violation of these directions attracts action under the said Act. Dr. Bimal Jalan, the then
Governor, RBI, announced the Bank’s ‘Clean Note Policy’ in January 1999. For
effective execution of ‘Clean Note Policy’, withdrawing soiled and mutilated notes from
circulation is as important as pumping fresh notes into circulation.

RBI’s Clean Note Policy

 Bank shall accept and deliver currency notes in unstapled and unstitched
condition only.6
 Bank will ensure removal of soiled notes and will ensure such notes are not
circulated. All such notes will be replaced with good notes.
 All customers are requested to tender currency notes in unstapled condition. The
bank will also issue currency notes in unstapled condition.
 NOT to write or scribble on the currency notes.
 DO NOT use banknotes for making garlands/toys, decorating pandals and places
of worship or for showering on personalities in social events, etc.
 Count and check the currency notes before leaving the counter.
 Soiled and Mutilated currency notes are freely exchanged under RBI note refund
rules 2009 at Teller Counters.
 Coins and small denomination notes are freely accepted/issued at our cash
counters.
 It is to be noted that the watermark on these notes is a major security feature and
if the watermark is damaged or broken the machine classifies them as bad notes

Banks Policy :-

Based on the Reserve Bank of India guidelines, the systems and procedure to be
followed for currency management. It has made mandatory on the banks to discontinue
the practice of stapling the currency notes packets.
 JPCB Clean Note Policy/2

The steps include: mechanization of the currency verification and processing as also
shredding and briquetting for destruction of soiled and mutilated notes. The banks shall
take the measures to supply adequate quantities of fresh notes and to prevent
excessive spoilage of the existing currency notes. A major factor for spoilages and
mutilation of notes was stapling and multi stapling of notes/notes packets. Non-stapling
of notes facilitates proper sorting of notes at bank branches by using table-top sorting
machines.

i. Not to staple bank notes,

ii. To tender soiled notes to the Reserve Bank in unstapled condition,
iii. To use paper bands instead of staple pins,
iv. To issue only clean notes to members of public,
v. To provide unrestricted facility for exchange of soiled and mutilated notes to
members of public.
vi. To examine of notes before issuance over the counter, top up of ATMs,

I. Facility for Exchange of Notes and Coins

With respect to the Facility for Exchange of Notes and Coins, the Bank shall adhere to
the below mentioned instructions:

1. All branches to issue good quality notes and coins of all denominations on
demand, as also exchange soiled / mutilated / defective notes, accept coins and
notes for transactions or exchange. Branches should not refuse to accept small
denomination notes and / or coins tendered at their counter.
2. Soiled notes should not be issued to the public as re-issuable notes and shall be
deposited in currency chests / current accounts maintained with other Banks for
onward transmission to RBI offices. In order to facilitate quicker exchange
facilities, the definition of soiled note has been liberalized. A ‘soiled note’ means a
note which has become dirty due to normal wear and tear and also includes a two
piece note pasted together wherein both the pieces presented belong to the same
note and form the entire note with no essential feature missing. Branches to
accept these notes over the counters in payment of Government dues and for
credit to accounts of the public maintained with banks.
3. Mutilated Notes – Presentation and Passing:
A mutilated note is a note of which a portion is missing or which is composed of more
than two pieces. Mutilated notes may be presented at any of the Bank branches.
The notes so presented shall be accepted, exchanged and adjudicated by the
branches in accordance with Reserve Bank of India (Note Refund) Rules 2009.
4. Notes which have turned extremely brittle or are badly burnt, charred or
inseparably stuck up together and, therefore, cannot withstand normal handling,
shall not be accepted by the Bank branches for exchange. Instead, the holders
 JPCB Clean Note Policy/3

may be advised to tender these notes to the concerned Issue Office of the
Reserve Bank of India.
5. The Branch Manager shall act as ‘Prescribed Officer’ to adjudicate the notes
received at the branch for exchange in accordance with Reserve Bank of India,
Rules, 2009.

6. Exchange of mutilated and imperfect notes:

a. Where the number of notes presented by a person is up to 5 pieces,

branches should normally adjudicate the notes and pay the exchange value
over the counter. If the branches are not able to adjudicate the mutilated
notes, the notes may be received against a receipt and sent to the linked
currency chest branch of the currency chest Bank for adjudication. The
probable date of payment should be informed to the tenderers on the receipt
itself and the same should not exceed 30 days. Bank account details should
be obtained from the tenderers for crediting the exchange value by electronic
means.
b. Notes presented in bulk: Where the number of notes presented by a person
is more than 5 pieces not exceeding Rs.5000 in value, branches to send
such notes to nearby currency chest branch of Banks by insured post giving
the customers Bank account details (a/c no, branch name, IFSC, etc.) or get
them exchanged thereat in person. All other persons tendering mutilated
notes whose value exceeds Rs.5000 should be advised to approach the
nearby currency chest branch of Banks.

7. Mutilated / defective notes bearing ‘PAY’ / ‘PAID’ (or ‘Reject’) stamp of any RBI
Issue Office or any Bank’s Branch, if presented for payment at any of the Bank’s
branches shall be rejected under Rules 6(2) of Reserve Bank of India, Rules,
2009.
8. Any note with slogans and messages of political nature written across shall cease
to be legal tender and claim on such notes shall be rejected by the Bank.
9. Deliberately cut notes:
The notes, which are found to be deliberately cut, torn, altered or tampered with, if
presented for payment of exchange value should be rejected under Rule 6(3)(ii) of
the Reserve Bank of India (Note Refund) Rules, 2009. Although it is not possible
to precisely define deliberately cut notes, a close look at such notes will clearly
reveal any deliberate fraudulent intention, as the manner in which such notes are
mutilated will follow a broad uniformity in the shape/location of missing portions of
the notes, especially when the notes are tendered in large numbers. The details of
the case such as the name of the tenderer, the number of notes tendered and
their denominations should be reported thereafter to the Deputy/General Manager,
Issue Department, Reserve Bank of India. The matter should also be reported to
local police in case a large number of such notes are tendered.
10. The Bank’s Branches shall display at their branch notice boards indicating the
availability of note exchange facility with the legend ‘SOILED / MUTILATED
 JPCB Clean Note Policy/4

NOTES ARE ACCEPTED AND EXCHANGED HERE’ for information of general

public.
11. Cashiers at branches to do away with stapling of note packets and shall band the
packets with paper/polythene bands so that the life of the currency notes is
increased.
12. Branch Managers / Cashiers to educate the members of public, not to write on the
currency notes to provide unrestricted facility for exchange of soiled and mutilated
notes.
13. Branch Managers / Cashiers to exclusively provide currency exchange and
distribution of small coins to suck out the bad notes.
14. The coins of denomination of 25 paise and below, issued from time to time, cease
to be legal tender for payments as well as account with effect from June 30, 2011
in terms of Gazette Notification No.2529 dated December 20, 2010 issued by the
Government of India.
15. Pre-2005 bank notes if received, shall not be exchanged as legal tender across
the counter, and the cashiers/Branch Managers shall guide such customers to
exchange such notes at the Issue Office of Reserve Bank of India.

II. Detection and Impounding of Counterfeit Notes:

With respect to the detection and impounding of counterfeit notes, the Bank shall
adhere to the below mentioned instructions:

1. Banknotes tendered over the counter through bulk tenders shall be examined for
authenticity through note counting machines. No credit to customer’s account is to
be given for counterfeit notes, if any, detected in the tender received over the
counter or at the back-office / currency chest.
In no case, the counterfeit notes should be returned to the tenderer or destroyed by the
bank branches. Failure of the banks to impound counterfeit notes detected at their
end will be construed as willful involvement of the bank concerned, in circulating
counterfeit notes and penalty will be imposed for violation of Directive No.
3158/09.39.00 (Policy)/2009- 10 dated November 19, 2009 issued by the Reserve
Bank.
2. Impounding of counterfeit notes :

Notes determined as counterfeit shall be stamped as "COUNTERFEIT NOTE" and

impounded in the prescribed format (Annex I). Each such impounded note shall be
recorded under authentication, in a separate register.

3. When a banknote tendered at the counter of a Bank branch is found to be

counterfeit, an acknowledgement receipt in the prescribed format shall be issued
to the tenderer, after stamping the note. The receipt, in running serial numbers,
shall be authenticated by the cashier and tenderer. Notice to this effect shall
displayed prominently at the branches notice boards for information of the public.
 JPCB Clean Note Policy/5

The receipt is to be issued even in cases where the tenderer is unwilling to

countersign it.
4. Detection of Counterfeit Notes - Reporting to Police and other bodies:

The following procedure should be followed while reporting incidence of detection of

counterfeit note to the Police:

a. For cases of detection of counterfeit notes up to 4 pieces, in a single

transaction, a consolidated report in the prescribed format should be sent by
the Nodal Bank Officer to the police authorities or the Nodal Police Station,
along with the suspect counterfeit notes, at the end of the month.
b. For cases of detection of counterfeit notes of 5 or more pieces, in a single
transaction, the counterfeit notes should be forwarded by the Nodal Bank
Officer to the local police authorities or the Nodal Police Station for investigation
by filing FIR in the prescribed format (Annex II).

A copy of the monthly consolidated report / FIR shall be sent to the Forged Note
Vigilance Cell constituted at the Head Office of the Bank.

c. Acknowledgement of the police authorities concerned has to be obtained for

note/s forwarded to them both as consolidated monthly statement and FIR. If the
counterfeit notes are sent to the police by insured post, acknowledgement of
receipt thereof by the police should be invariably obtained and kept on record. A
proper follow-up of receipt of acknowledgement from the police authorities is
necessary. In case, any difficulty is faced by the Branches due to reluctance of the
police to receive monthly consolidate statement / file FIRs, the matter may be
sorted out in consultation with the Nodal Officer of the police authority designated
to coordinate matters relating to investigation of counterfeit banknotes cases. The
list of Nodal Police Station may be obtained from the respective Regional Office of
Reserve Bank.
5. Branches to monitor the patterns / trends of such detection and suspicious trends /
patterns should be brought to the notice of RBI /Police authorities immediately.

The data on detection of counterfeit Indian notes at branches should be included

in the monthly Returns forwarded to the Reserve Bank.

The branches should re-align their cash management in such a manner so as to

ensure that cash receipts in the denominations of Rs 100 and above are not put
into re-circulation without the notes being machine processed for authenticity. In
order to obviate complaints regarding receipt of counterfeit notes through ATMs,
branches to take adequate safeguards/checks before loading ATMs with notes.
Dispensation of counterfeit notes through the ATMs would be construed as an
attempt to circulate the counterfeit notes by the Bank concerned.
 JPCB Clean Note Policy/6

6. Penalty at 100% of the notional value of counterfeit notes, in addition to the

recovery of loss to the extent of the notional value of such notes, will be imposed
under the following circumstances:
a) When counterfeit notes are detected in the soiled note remittance of the bank.
b) If counterfeit notes are detected in the currency chest balance of a bank during
inspection by RBI.
7. Each Bank shall establish at its Head Office, a Forged Note Vigilance Cell to
undertake the following functions:
i. Dissemination of instructions issued by the Reserve Bank on counterfeit notes to
Bank’s branches. Monitoring the implementation of these instructions. Compilation
of data on detection of counterfeit notes, and its submission to Reserve Bank and
FIU-IND as per extant instructions. Follow-up of cases of counterfeit notes, with
police authorities / designated nodal officer.
ii. Sharing of the information thus compiled with Bank’s Designated Nodal Officer
and report to him / her all cases of acceptance / issue of counterfeit notes over the
counters.
iii. Conducting periodic surprise checks at branches where shortages/
defective/counterfeit notes etc. are detected.
iv. Ensuring operation of Note Sorting Machines of appropriate capacity at all the
branches and closely monitoring the detection of Counterfeit Notes and
maintaining the record of the same. Ensuring that only properly sorted
andmachine examined banknotes are fed into the ATMs / issued over the counters
and to put in place adequate safeguards, including surprise checks, both during
the processing and in transit of notes.

Forged Note Vigilance Cell shall submit status report on a quarterly basis covering
the aforesaid aspects to the Chief General Manager, Department of Currency
Management, Reserve Bank of India, Central Office, Amar Building, Fourth Floor,
Sir P. M. Road, Fort, Mumbai 400 001, and to the Issue office of the Regional
office of Reserve Bank under whose jurisdiction the FNV Cell is functioning, within
a fortnight from the conclusion of the quarter under report. The said report should
be sent by mail. No hard copy need be sent.

In order to update the record of the addresses of the Forged Note Vigilance Cells,
the Bank shall furnish by e-mail, in the prescribed format particulars to the
Reserve Bank every year, as on 1st July. No hard copy need be sent.

8. Scheme of Penalties for Bank branches including currency chests based

on performance in rendering customer service to members of public:

In line with RBI circular no DCM (CC) No.G-4/03.44.01/2018–19 dated 3rd July
2018 the Scheme of Penalties for Bank branches including Currency Chests has
been formulated in order to ensure that all Bank branches provide better
 JPCB Clean Note Policy/7

customer service to members of public with regard to exchange of notes and

coins in keeping with the objectives of Clean Note Policy.

Penalties to be imposed on Banks for deficiencies in exchange of notes and

coins / remittances sent to RBI / operations of currency chests etc. are as
follows:

No. Nature of Irregularity Penalty

1 Shortages in soiled note For notes in denomination upto Rs.50
remittances and currency chest per piece in addition to the loss
balances For notes in denomination of Rs 100 &
above Equal to the value of the
denomination per piece in addition to
the loss.
Shortages of 100 pieces and above
per remittance shall be debited
immediately. Penalty may be levied on
reaching a limit of 100 pieces in a
cumulative manner.
2 Counterfeit notes detected in Penalty on account of detection of
soiled note remittances and counterfeit notes by RBI from soiled
currency chest balances. note remittance of banks and in
currency chest balances shall be
levied in terms of the instructions
issued by DCM (FNVD)No. G-
1/16.01.05/2018-19 dated July 02,
2018.
3 Mutilated notes detected in soiled Rs. 50 per piece irrespective of the
note remittances and currency denomination Mutilated notes of 100
chest balances. pieces and above per remittance shall
be debited immediately. Penalty may
be levied on reaching a limit of 100
pieces in a cumulative manner.
4 Non-compliance with operational Penalty of Rs 5000 for each
guidelines by currency chests irregularity.
detected by RBI officials:
a) Non-functioning of CCTV Penalty will be enhanced to Rs 10,000
b) Branch cash/documents kept in in case of repetition.
strong room
c) Non-utilization of NSMs for Penalty will be levied immediately.
sorting of notes (NSMs not used
for sorting of high denomination
notes received over the counter
or not used for sorting notes
remitted to chest/RBI)
 JPCB Clean Note Policy/8

5 Violation of any term of Rs. 10,000 for any violation of

agreement with RBI (for opening agreement or deficiency of service.
and maintaining currency chests)
or deficiency in service in Rs. 5 lakhs in case there are more
providing exchange facilities, as than 5 instances of violation of
detected by RBI officials e.g. agreement/ deficiency in service by
a) Non-issue of coins over the the branch. The levy of such penalty
counter to any member of public will be placed in public domain.
despite having stock.
b) Refusal by any bank branch to Penalty will be levied immediately.
exchange soiled notes / refusal by
any currency chest branch to
adjudicate mutilated notes
tendered by any member of
public.
c) Non conduct of surprise
verification of chest balances, at
least at bimonthly intervals, by
officials unconnected with the
custody thereof and by the
officials from the Controlling
Office once in six months.
d) Denial of facilities/services to
linked branches of other banks.
e) Non acceptance of lower
denomination notes (i.e.
denomination of Rs. 50 and
below) tendered by members of
public and linked bank branches.
f) Detection of mutilated
/counterfeit notes in re-issuable
packets prepared by the currency
chest branches.

9. Provision of Ultra-Violet Lamp and Other Infrastructure:

With a view to facilitating the detection of Counterfeit Notes, all bank branches
should be equipped with ultra-violet lamps / other appropriate banknote
sorting/ detection machines.

The Bank shall maintain a daily record of the notes processed through the Note
Sorting machines, including the number of counterfeit notes detected.

10. Detection of Counterfeit Notes-Training of Staff:

It is necessary to ensure that the cash handling staff in the Bank are fully
conversant with the security features of a banknote.
 JPCB Clean Note Policy/9

The HRD Department shall organize/conduct training programme on the

security features of banknotes for members of staff to enable detection of
Counterfeit Notes at the point of receipt itself. The Bank shall ensure that all
the Bank personnel handling cash are trained on features of genuine India
Bank notes. These trainings shall cover detection, impounding and reporting
of Counterfeit Notes.

Public Awareness:
The bank shall undertake several measures to enhance public awareness for Clean
Note Policy by way of pasting Stickers, Publishing Circulars to its staff, displaying
security features of notes. Banks and public need to accept the change to paper/
polythene bands and move away from staple pins. Urged the public not to write on the
currency notes and deface.

Name : Mr. Dinesh Bhalchandra Yeole

Designation : Incharge – FNIVC
Bank’s Name : The Jalgaon Peoples Co-operative Bank Ltd.
Bank’s Address : 152, Polan Peth, Dana Bazar, Jalgaon 425001.
Contact No. : 0257- 2227711 to 16.

Incharge – P&D General Manager

Approved by

M. D. & CEO. CHAIRMAN

BOD R.NO. & DATE: ___________________

 JPCB Clean Note Policy/10

CLEAN NOTE POLICY

NOTICE TO THE CUSTOMERS

AS PER THE GUIDELINES OF RESERVE BANK OF INDIA, UNDER THEIR “CLEAN

NOTE POLICY” WE REQEUST THE CUSTOMER TO: -

1. DEPOSIT THE CASH WITHOUT ANY STAPLE PIN OR THREAD.

2. NOT TO WRITE ANYTHING ON THE CURRENCY NOTES.
3. AVOID SPOILING NOTES BY OIL, WATER, INK ETC.
4. NOT TO FOLD THE NOTES TO SMALL SIZE.
5. ENSURE COUNTING OF NOTES BEFORE LEAVING THE CASH COUNTER.
6. DEPOSIT THE CASH AFTER SEPARATING ASHOKA PILLAR CURRENCY
NOTES AND OTHER SOILED / NON -ISSUABLE NOTES.
7. DO NOT USE BANKNOTES FOR MAKING GARLANDS/TOYS, DECORATING
PANDALS AND PLACES OF WORSHIP OR FOR SHOWERING ON
PERSONALITIES IN SOCIAL EVENTS, ETC.

WE ACCEPT AND DELIVER CURRENCY NOTES IN DESTAPLED AND

UNSTITCHED CONDITIONS ONLY.

PLEASE DO NOT WRITE OR SCRIBBLE ON THE CURRENCY NOTES.

COINS AND SMALL DENOMINATIONS NOTES ARE FREELY EXCHANGED AT

OUR CASH COUNTERS.

WE DISTRIBUTE COINS AGAINST NOTES.

SOILED AND MUTILATED CURRENCY NOTES ARE FREELY EXCHANGED AT
OUR CASH COUNTERS.
 JPCB Clean Note Policy/11

Annex I

Each banknote, which, on examination of various security features / parameters, is

determined as a counterfeit one, shall be branded with a stamp "COUNTERFEIT
BANKNOTE". For this purpose, a stamp with a uniform size of 5 cm x 5 cm with the
following inscription may be used.

COUNTERFEIT BANKNOTE IMPOUNDED BANK

TREASURY
SUB-TREASURY BRANCH
CURRENCY CHEST
NAME OF THE BANK
SIGNATURE
DATE