Changing security features of Rs 500 and 2,000 notes could tackle fake currency menace
The battle to check the ever-growing menace of fake high-denomination notes, one of the primary reasons behind Prime Minister Narendra Modi’s demonetisation drive, is an ongoing one. Even though the November 8, 2016 diktat had promised instant elimination of counterfeit currency from the national circulation, sadly that has not been the case.
The alarming rise of the fake versions of the new Rs 2,000 and Rs 500 notes, seized in bulk amounts within weeks of the demonetisation announcement, has kept the government on its toes. Hence, the latest “plan” to keep the security features in the new notes changing every three-four years, updating them so as to be one step ahead of the counterfeiters, is indeed a feasible one.
The PTI report also says that the practice of updating security features in high-value currency notes is in keeping with global standards, even though use of cash is getting increasingly disincentivised in highly developed economies. The report further states that the matter of updating security features in high-denomination notes was discussed at a top-level joint meeting between representatives of finance and home ministries, indicating that this is a concern of not just sound economics, but also national security.
This was indicated by the presence of home secretary Rajiv Mehrishi at the meeting, and the issue of ensuring counterfeit-proof circulation of high-denomination currency as the country takes giant leaps towards a cash-less economy, was discussed at length, as a matter of public policy.
Why is this necessary?
Fake note menace, even after demonetisation, has created a nightmarish situation for the government. High quality fake Rs 2,000 notes were seized in a number of occasions, as late as February this year, in which the National Investigation Agency (NIA) recovered three counterfeit Rs 2,000 notes that were superlative in quality.
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| The alarming rise of the fake versions of the new Rs 2,000 and Rs 500 notes has kept the government on its toes. |
Though in this instance, the illegal note had a Malda connection, a place which has come under police scanner for its history of fake Indian currency network (FICN) smuggling, on other occasions, inferior quality illegal notes were captured in mammoth quantities.
The fake note menace also saw laughable tricks such as photocopies of the Rs 2,000 and Rs 500 notes, notes printed with the words “Children Bank of India” dispensed from ATMs, and various other crazy instances of cash going rogue, spawning the on-and-off trend “pink is the new black”.
What are the faked security features?
According to investigators, out of the 17 new security features in the post-demonetisation high-value currency printed, 11 have been already replicated in fake notes.
Features such as the Ashoka Pillar emblem, the transparent area, watermark, the letters “Rs 2,000” on the left hand side of the note, the guarantee clause with the RBI governor’s sign, the denomination number on the front – have all been successfully faked.
Additionally, the motif of “Chandrayaan”, the Swachh Bharat logo, year of printing have all been copied on the reverse side, causing enormous confusion among both the intelligence community as well as ordinary citizens who were left with a fake note dispensed from an ATM, or handed over the counter at a shop in great distress.
Why design lag matters
Moreover, India has been notoriously laggard in updating security and design features in its currency notes. For example, till its demonetisation, the Rs 1,000 note hardly saw any design or security update right from its introduction in 2000.
Similarly, even though the Rs 500 note was first introduced in 1987, it didn’t really see periodic security updates, and the last one was almost a decade back. It must be remembered that the fake note industry used this feature of the un-updated Rs 500 note, and exploited this loophole in the currency circulation to the hilt, flooding the economy with counterfeit notes.
Terror and fake notes
Even though the Indian Statistical Institute has estimated the total value of the fake note industry in India at about Rs 400 crore, its impact has been greater, because of the direct correlation between cross-border terrorism and counterfeit notes networks. The ISI connection to many of these fake currency rackets is unmissable and cannot be stressed enough.
Updating security features and coming up with cutting-edge security designs that are both aesthetically pleasing and robust in terms of being not easily replicable, would go a long way in ensuring a healthier, relatively whiter economy.
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