What is Currency Chest?
Currency Chests are places where RBI (Reserve Bank of India) stocks money meant for banks and ATMs. The Currency Chests are located in different banks and are administered by the Reserve Bank of India.
Why is Current Chest in news recently?
A private security guard has looted Rs 4.04 crores from the currency chest of Axis Bank in Chandigarh. This has brought currency chests in spotlight.
What is Currency Chest?
The Currency chests are places where RBI stores money meant for ATMs and banks. The representatives from RBI inspect these currency chests from time to time. These currency chests are placed in banks spread all over the country. The money in the currency chest belongs to RBI and the money placed outside currency chest in the strong room belongs to the bank.
Whenever RBI prints new currency notes, it first delivers them to these currency chests. The banks holding the currency chests will then deliver them to the other banks.
Who will fulfil the losses?
Now, RBI is prone to losses due to the theft. The entire money in the chest belongs to RBI. Now the question arises who will bear the losses? The bank that holds the currency chest should bear the losses. The bank should also submit a Fraud Monitoring Report to RBI.
Security of the Currency Chest
The RBI reimburses the security expenses to the bank. The reimbursement includes transportation of money from one bank to another as well. It is the sole responsibility of the banks to safeguard the cash.
How is currency distributed in India?
- RBI has thirty-one offices in India. When new currencies are printed, RBI sends them to these offices. These offices then send the notes to the currency chests and small coin depots.
- There are 4,075 currency chests in the country.
- Around 3,746 banks act as small coin depots.
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Category: Economy & Banking Current Affairs
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