Govt to Privatise Distribution to End the Glut of Coins

The India Government Mint has, for quite some time now, been witnessing a growing accumulation of coins that remain unlifted by the Reserve Bank of India (RBI) for circulation. Despite continued production, large volumes of these coins are lying in storage across various minting facilities, resulting in a significant and persistent buildup.

The Currency and Coin (C&C) Division under the Ministry of Finance, along with the RBI, has repeatedly raised concerns regarding what they have termed a “reverse flow” of coins — a situation where coins manufactured in substantial volumes are not being transported onwards for circulation at the expected pace. This persistent mismatch between production and lifting has prompted the government to explore alternative strategies, including the possibility of engaging private entities to support coin distribution and transportation. These discussions stem from high annual indents combined with the slow pace at which coin consignments are currently being lifted by the RBI machinery.

Recent developments indicate that RBI officials have acknowledged the severity of the coin surplus issue, presenting what has been described as an “alarming” assessment of current stockpiles. Despite this, the central bank has assured the government and SPMCIL that all quantities duly indented will now be lifted in a more streamlined manner.

According to reports, the RBI currently holds an estimated 9 billion coins in its inventory. For the financial year 2019–20, the projected indent issued to the Security Printing & Minting Corporation of India Ltd. (SPMCIL) stands at 3,400 million coins — a figure that is only about one-third of SPMCIL’s total annual production capacity. This sharp contrast between production capability and actual demand underscores the need for corrective measures, both operational and policy-driven, to ensure efficient coin circulation management.

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