Mumbai: India’s central bank’s currency printing arm has invited expressions of interest (EoI) from manufacturers around the world to supply polymer substrate sheets with built-in security features for printing polymer banknotes, officials familiar with the matter told ET.
If introduced, it would be a first step in a country where the Reserve Bank of India has been using specialized paper to print money for nearly a century.
Bharatiya Mudran Reserve Bank Note (BRBNMPL) has invited eligible domestic and international manufacturers to submit applications by August 18th.
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The company is looking for suppliers capable of producing opaque polymer backing sheets with suitable security features for banknotes.
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However, the EOI does not indicate the expected denominations that will be printed using this material, nor the timing of the introduction of polymer banknotes into circulation.
The tender imposes strict national security conditions. Bidders must obtain government approval, insulate any operations in China or Pakistan from the contract with India, avoid sourcing raw materials from the two countries for the manufacture of banknote backing destined for India, and undertake not to supply banknote backing destined for India to any third country. To qualify, bidders must have supplied polymer banknote substrates with security features to central banks or banknote printing organizations for at least the last three years.
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Field tests
They must also demonstrate the ability to supply at least 20,400 stops, or 30% of the estimated requirement. The initial requirement is 68,000 packs (about 34,000 packs for the two denominations), although BRBNMPL said this is for immediate needs only and larger purchases may follow after successful field trials.
Last month, RBI Governor Sanjay Malhotra said Mint Road was exploring the possibility of introducing polymer notes, although discussions were still at a preliminary stage. Polymer notes, made from durable plastic films, generally last longer than paper notes and require less frequent replacement due to their greater resistance to wear and tear.
The move comes even as the RBI’s currency printing costs have come down.
Banknote printing costs fell by nearly a quarter to ₹4,875 crore in 2025-26 from a year earlier, largely due to lower printing requirements, the RBI’s annual report showed.
The decline in printing costs came despite the value of cash in circulation rising 12% to ₹41.23 crore at the end of March 2026 from ₹36.86 crore a year earlier, indicating continued demand for cash.
The ₹500 note remained dominant, accounting for 86% of the total currency value in circulation at ₹35.27 crore, with over 7 billion notes in circulation, accounting for 41% of the total. The currency-to-GDP ratio increased to 12.1% at the end of March 2026 from 11.7% a year earlier, indicating that cash use remains resilient despite the rapid adoption of digital payments.
However, it remains below the post-demonetization peak of 14.4% recorded in March 2021, when re-monetization following the note ban in 2016 led to a surge in currency in circulation.