"We are still at a pilot stage. We will test and evaluate how they [the polymer currency notes] perform under Indian conditions, including the climate and the infrastructure we have in place. Thereafter, we will assess whether they need to be scaled up as they are or with modifications," Malhotra said during a press conference, according to The Hindu.
"If everything goes as planned, we are targeting that they will be in circulation at the beginning of the next financial year," he added.
Explaining the rationale behind the move, the RBI Governor said polymer notes would offer two key advantages.
"Firstly, they enhance the durability and lifespan of lower-denomination currency notes. Since these notes circulate more frequently, they wear out faster. Polymer notes have been in use in several countries for more than 30 years, and their lifespan is typically three to four times longer than that of paper-based notes," he said.
"Secondly, polymer notes will expand the RBI's currency printing capacity as the needs of the economy continue to grow," Malhotra added.
Earlier this year, the Centre approved the RBI's proposal to conduct field trials of polymer currency notes in ₹10 and ₹20 denominations. A wider rollout will depend on the outcome of the pilot programme.
Meanwhile, in its latest Monetary Policy Statement, the RBI projected India's real GDP growth at 6.7 per cent and retail inflation at 5 per cent for the financial year 2026-27.
The six-member Monetary Policy Committee (MPC) unanimously voted to keep the policy repo rate unchanged at 5.25 per cent while retaining its neutral policy stance.