Govt refutes reports claiming no ₹500 notes in ATMs from September

The Government on August 5 clarified that there is no proposal to stop the supply of ₹500 banknotes, and ATMs will continue to disburse them alongside ₹100 and ₹200 notes.

In a written reply in the Rajya Sabha, Minister of State for Finance Pankaj Chaudhary said the printing of banknotes of specific denominations is decided by the government in consultation with the Reserve Bank of India (RBI) to maintain the desired mix for public transactions as smaller denominations are used more frequently.

The clarification came amid reports suggesting a phase-out of ₹500 notes from ATMs. The minister said the RBI, in a circular dated April 28, 2025, had only directed banks and White Label ATM operators to enhance public access to ₹100 and ₹200 notes by meeting the following milestones–

• By September 30, 2025, 75% of all ATMs must dispense either ₹100 or ₹200 notes from at least one cassette.
• By March 31, 2026: 90% of all ATMs must meet the same condition.

The move, the RBI has said, is aimed at ensuring the regular availability of lower denominations for everyday transactions.

The clarification came in response to a question by MPs Yerram Venkata Subba Reddy and Milind Murli Deora, who asked whether the government was prioritising lower denominations, if the RBI had directed banks to stop disbursing ₹500 notes from ATMs by September 30, 2025, and whether the central bank planned to issue only ₹100 and ₹200 notes henceforth. 

They also sought reasons for such a move, its enforcement mechanism, and its likely impact on public convenience and cash accessibility.