Decoding News

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Currency Chest Overview:

Fake Note Detection in SBI
Currency Chest
 Recently, two significant cases have come to light where
counterfeit currency notes were discovered within the State
Bank of India's (SBI) currency chest located in Kochi, Kerala.

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 Purpose of Currency Chests:

Currency chests serve as secure storage facilities for the

money allocated to banks and ATMs by the Reserve Bank of
India (RBI).
RBI grants authorization to specific scheduled banks for the
establishment of currency chests.
These chests are under the supervision of RBI, subject to
periodic inspections by RBI representatives.

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 Currency Handling Process:

Freshly printed currency notes from RBI are initially

dispatched to currency chests.
Banks with currency chests then distribute these notes to
other bank branches in their operational region.
Currency chests function as central hubs for cash distribution.

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 Functions of Currency Chests:

They facilitate the collection of worn-out or damaged

notes from the public.
In cases of excess cash balances at banks, surplus funds
are deposited in currency chests, and conversely, they
provide cash during shortages.

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Guidelines for Establishing Currency Chests:

Minimum room or vault area of 1500 sq. ft. is required for

standard locations.
For hilly or remote areas, a minimum room or vault area
of 600 sq. ft. is acceptable.
Currency chests should have a processing capacity of 6.6
lakh pieces of banknotes per day in regular locations.
For hilly or remote areas, a capacity of 2.1 lakh pieces of
banknotes per day is sufficient.
The Chest Balance Limit (CBL) should ideally be ₹1,000
crore, but practical adjustments can be made as per RBI
discretion, considering local conditions.

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