Deadline extended: Old Rs500 notes can only be exchanged

Central bank cautions that the banknote cannot be used in transactions.

KARACHI: The State Bank of Pakistan (SBP) has announced that people can still exchange old design and bigger size banknote of Rs500 from commercial banks and field offices of the SBP Banking Services Corporation (SBP BSC), but cautioned that these notes stand demonetised and cannot be used in money transactions.

In an announcement on Friday, the SBP said it had directed all commercial banks and field offices of SBP BSC to start exchanging old design currency notes of Rs500 with immediate effect and the facility would be available by the end of September 2012.

“This directive only allows the exchange of Rs500 old design banknote to facilitate the general public, who are in possession of such notes. However, this banknote stands demonetised and, hence, cannot be used as a legal tender,” the SBP said.

The move came following an announcement by the government last week that the deadline for exchange of old Rs500 notes had been extended as many people could not exchange their savings with new notes due to a lack of awareness of the issue. Earlier, the deadline was September 30, 2011.

Over 10,000 branches of commercial banks and 16 field offices of SBP BSC will exchange these notes till the last working day of September next year.

The SBP also advised banks to surrender all these banknotes to SBP BSC field offices for exchange or credit into their bank accounts up to the last working day of September 2012.

Banks have also been asked to widely publicise the extension of date for awareness and facilitation of general public.

Published in The Express Tribune, November 12^th,  2011.