What are RBI’s Currency Chests?

One main function of the RBI is to deliver currency notes across the country. it has to distribute new currency notes and rupee coins, recycle old notes, keep cash reserves of banks (CRR). Similarly, it has to facilitate orderly transfer of bulk currency notes across regions. For all these purposes, the RBI has some sort of currency store houses known as currency chests. Currency chests acts as networks of currency distribution.

The main function of currency chests is to facilitate note supply. As there are around 4102 currency chests, they help the RBI to undertake smooth supply of currency notes across the country. The cash reserve ratios of the commercial banks are also kept at currency chests. For example, in the demonetization process, the currency chests absorbed old notes and supplied new currency notes.

Main function of currency chests is store currency notes and coins. Currency chests are usually located at authorized select branches of scheduled banks. These currency chests are store houses of bank notes and rupee coins and are usually established with important branches of Scheduled Commercial Banks. They do their function on behalf of the Reserve Bank. As on March 2016, there were 4102 Currency Chests and 3783 Small Coin Depots. The currency chest branches are expected to distribute banknotes and rupee coins to other bank branches in their area of operation.