A widely circulated message on social media claiming that the Reserve Bank of India (RBI) has directed banks to stop dispensing ₹500 currency notes from ATMs by September 2025 has been declared false by the Press Information Bureau (PIB) Fact Check unit.
Amid growing online speculation, the PIB Fact Check team issued a clear statement debunking the rumour, stating, “There is no such instruction from the RBI to discontinue ₹500 notes in ATMs.” The RBI has also officially clarified that ₹500 notes remain legal tender, and no move is being made to withdraw them.
What’s Actually Happening?
The confusion stems from a real circular that RBI issued on July 19, 2024, regarding the configuration of ATMs to improve access to lower denomination notes. According to the RBI directive:
- By September 30, 2025, 75% of all ATMs should be configured to dispense ₹100 or ₹200 denomination notes.
- By March 31, 2026, 90% of ATMs across India should be capable of dispensing ₹100 or ₹200 notes.
These instructions apply to both bank-managed ATMs and White Label ATM Operators (WLAOs), the latter being private non-bank ATM service providers.
The aim is to ensure better availability of smaller denomination notes for day-to-day use by the public. There has been growing demand for easier access to ₹100 and ₹200 notes, especially in rural and semi-urban areas where exact change is often needed for basic transactions.
No Mention of Removing ₹500 Notes
The RBI’s official communication makes no reference to phasing out or withdrawing ₹500 notes. These higher denomination notes will continue to be in circulation and can still be dispensed through ATMs, even after the new configuration deadlines.
The misinformation appears to have originated from a misinterpretation or deliberate distortion of RBI’s genuine attempt to balance the currency note supply for better public convenience.
PIB Fact Check: A Vital Source Against Misinformation
The PIB Fact Check unit, a wing under the Ministry of Information and Broadcasting, has been actively working to curb the spread of fake news, especially on social and digital platforms. In this case, the fact check team quickly stepped in to verify and debunk the misleading claim.
Their clarification reads:
“Claim: RBI has instructed banks to stop ₹500 notes in ATMs by Sept 2025.
Fact: ❌False! RBI only advised banks to increase availability of ₹100/₹200 notes in ATMs for better public access. ₹500 notes remain valid legal tender.”
RBI’s Push for Financial Accessibility
This latest move by the RBI aligns with broader efforts to improve the financial inclusion ecosystem. By ensuring more ATMs dispense lower denominations, the RBI is helping:
- Small traders and vendors who prefer exact change
- Customers in remote areas with limited access to banks
- Elderly citizens who find large denominations difficult to manage
The move also complements digital financial inclusion, giving people more flexibility between cash and digital payments.
✅ Conclusion
There is no need to panic or believe the viral messages regarding the discontinuation of ₹500 notes. The RBI has made no such announcement. Instead, it is working toward enhancing public access to ₹100 and ₹200 notes through updated ATM configurations. The PIB Fact Check and RBI’s statements make it clear that ₹500 notes remain fully valid and legal.
Sources:
- Press Information Bureau Fact Check: @PIBFactCheck on X (Twitter)
- Reserve Bank of India Official Circular (July 2024): www.rbi.org.in
