India witnessed a worrying spike in counterfeit Rs 500 notes in the financial year 2024–25 (FY25), even as the total number of fake notes detected across denominations showed a gradual decline. According to the Reserve Bank of India’s (RBI) annual report, counterfeit Rs 500 notes jumped 37.35% year-on-year, rising from 85,711 pieces in FY24 to a troubling 117,722 pieces in FY25—the highest level recorded in the last six years.
This concerning rise comes at a time when the overall number of counterfeit notes across denominations decreased from 222,638 in FY24 to 217,396 in FY25, marking a downward trend in total fake currency circulation. The Rs 500 denomination, however, remains the most targeted by counterfeiters, accounting for more than half of all detected fake banknotes.
The report reveals interesting patterns across denominations. Fake Rs 200 notes rose by 13.9% to 32,600 pieces, while counterfeit Rs 100 notes dropped by nearly 23% to 51,069 pieces—reflecting inconsistent trends across currency categories.
In sharp contrast, counterfeit Rs 2000 notes plunged by a massive 86.5%, from 26,035 pieces in FY24 to just 3,508 pieces in FY25. This drop was expected, following the RBI’s decision to withdraw Rs 2000 notes from circulation starting May 19, 2023. As per RBI, 98.24% of all Rs 2000 notes in circulation at the time of withdrawal have already been returned.
Experts believe the spike in fake Rs 500 notes may be linked to their widespread circulation, heavy use in daily transactions, and the fact that the Rs 500 note is now the highest-value currency in active circulation.
While the scale of counterfeit currency remains significantly lower than pre-demonetisation levels, the sharp rise in fake Rs 500 notes underscores the continuing challenge of currency security—and the need for advanced detection technologies and public awareness.
