₹500 notes remain fully valid and are not being banned or phased out; the Reserve Bank of India’s latest move is about improving ATM access to ₹100 and ₹200 notes for everyday convenience, not about stopping ₹500. The finance ministry has clarified there is no instruction to halt ₹500 dispensation from ATMs or any plan to withdraw the denomination, so continue using it confidently.
There has been confusion due to viral messages suggesting banks must stop dispensing ₹500 notes by specific deadlines, but these claims have been officially debunked; the ₹500 note remains legal tender for all transactions across India. What actually changed is an RBI directive asking banks and White Label ATM operators to ensure a higher share of ATMs dispense ₹100 and ₹200 notes regularly to make getting change easier, especially outside metros.
RBI Issues New Guideline
There is no RBI instruction withdrawing ₹500 notes; they remain valid and in circulation. The new guideline is about improving access to lower denominations through ATMs, with phased milestones, and it does not curtail ₹500 in any way. Rely only on official communications and verified government updates, and ignore forwards that lack an explicit, verifiable circular.
What Exactly Changed and What Didn’t
RBI’s April 2025 circular set phased targets so more ATMs carry lower denominations: at least 75% by September 30, 2025, and 90% by March 31, 2026, must dispense ₹100 or ₹200 from at least one cassette. This change addresses long-standing public demand for smaller notes to handle daily purchases smoothly, without forcing customers to over-withdraw higher denominations for lack of change. Crucially, there is no instruction to stop loading or dispensing ₹500 notes; banks will continue stocking ₹500 alongside the smaller notes.
₹500 Remains Legal Tender and In Use
Multiple official clarifications have underlined that ₹500 in the Mahatma Gandhi (New) Series is valid for payments, deposits, and ATM withdrawals nationwide. RBI’s currency communications and fact checks emphasize that no discontinuation timeline exists for ₹500, and the denomination remains part of the current series with prescribed security features and design specifications. Any forward advising you to “liquidate” ₹500 notes is misinformation.
Why The ATM Mix Is Being Rebalanced
A high share of ATMs used to dispense only large denominations, making it hard for people to get smaller notes for everyday transactions, particularly in semi-urban and rural areas. With the new targets, banks and ATM operators are reconfiguring cassettes and cash logistics so more machines reliably deliver ₹100 and ₹200 notes, which should reduce dependency on shopkeepers for change and cut extra withdrawal rounds. This operational tweak improves cash convenience without sidelining ₹500.
Beware Of Viral Claims And Fake Circulars
Viral posts claiming RBI has ordered banks to stop ₹500 from ATMs by September 2025 or to phase out the note by 2026 have been flagged as false by official fact-checks. Similarly, messages asserting a new window to exchange demonetised pre-2016 ₹500/₹1000 notes are also fake. Always verify such claims through official government or central bank channels before acting on them.
What This Means For You As A Customer
- Continue using ₹500 notes normally they remain valid and widely accepted.
- Expect better access to ₹100 and ₹200 notes from a larger share of ATMs through 2025–26.
- Exchange soiled or mutilated notes at bank branches under the RBI Note Refund Rules; severely damaged notes should be taken to the nearest RBI Issue Office.
RBI ₹500 note latest update is simple and clear: ₹500 notes remain legal tender, and there is no plan to ban or phase them out; the current focus is on ensuring more ATMs dispense ₹100 and ₹200 notes to improve day-to-day cash convenience. RBI ₹500 note latest update also confirms there is no instruction stopping banks or WLAOs from loading ₹500 in ATMs, and milestones only require a minimum share of machines to carry smaller notes, not to exclude ₹500. Treat any message urging you to exchange or liquidate ₹500 holdings urgently as misinformation unless an official notification proves otherwise.
How Banks And ATM Operators Will Implement The Targets
Banks and WLAOs will recalibrate at least one ATM cassette to reliably stock ₹100 or ₹200 notes at most locations and adjust cash forecasting and replenishment cycles to meet the 75% and 90% milestones. The rollout will vary by region based on demand patterns, but it will not remove or restrict the presence of ₹500 in ATMs; rather, it adds predictable access to smaller notes. For customers, the visible change will be more machines offering mixed denominations, reducing the hassle of breaking higher-value notes.
Clarification On Old And Damaged Notes
There is no fresh program to exchange demonetised pre-2016 ₹500 or ₹1000 notes, and viral claims to the contrary are incorrect. For legitimate exchanges, RBI’s Note Refund framework covers soiled, mutilated, or imperfect notes at bank branches, while severely damaged notes brittle, charred, or inseparably stuck should be handled at RBI Issue Offices listed by the central bank. If you’re uncertain, consult your branch or check the latest master circular for note exchange facilities.
Practical Tips For Consumers
- Keep using ₹500 notes for payments and deposits without concern; they remain fully valid.
- Plan cash withdrawals knowing more ATMs will carry ₹100/₹200, making small purchases and change easier.
- Use bank branches for exchanging soiled or mutilated currency; take severely damaged notes to RBI Issue Offices.
FAQs on RBI Issues New Guideline
Is The ₹500 Note Being Phased Out?
Did RBI Tell Banks To Stop Loading ₹500 In ATMs?
Can I Exchange Old Demonetised ₹500/₹1000 Notes Now?
What Changes at ATMs in 2025–26?
Targets require 75% of ATMs to dispense ₹100/₹200 by September 30, 2025, and 90% by March 31, 2026; ₹500 continues
