If you have a ₹5 coin in your possession, then this news is crucial for you. The Reserve Bank of India (RBI) has recently issued an important update regarding the discontinuation of ₹5 coins. Read this article till the end to get complete details about this latest announcement by the government and RBI.
₹5 Coin Discontinuation: What You Should Know
According to the latest update from RBI, there is widespread speculation regarding the discontinuation of ₹5 coins. However, ₹1 to ₹20 coins continue to remain in circulation in the Indian market. Despite rumors spreading rapidly on social media about the withdrawal of ₹5 coins, these coins are still legally in use. It is important to understand the reasons behind RBI’s decision and what changes are being made to the ₹5 coin.
Why Are ₹5 Coins Becoming Rare in the Market?
Lately, older and thicker ₹5 coins have become increasingly rare in the market, while newer, thinner ₹5 coins made of brass are more commonly found. The primary reason for the disappearance of old ₹5 coins is that their production has been discontinued. However, this discontinuation is linked to international concerns, specifically involving Bangladesh.
The Value and Demand for ₹5 Coins
Older ₹5 coins contained a significant amount of metal, making them highly valuable. Due to their high metal content, these coins were illegally smuggled to Bangladesh, where they were melted down to create other metal products. Reports suggest that a single thick ₹5 coin could be melted and reshaped into items worth up to ₹12 in value. This led to widespread misuse, prompting RBI to take action.
Why is Metal More Expensive in ₹5 Coins?
When determining the value of a coin, two key factors are considered: surface value and metal value. Surface value refers to the face value printed on the coin, while metal value is the worth of the materials used to make it. In the case of older ₹5 coins, their metal value exceeded their surface value, leading to their illegal trade and misuse.
RBI’s Decision to Modify the ₹5 Coin
As older ₹5 coins started disappearing from circulation, the government investigated the matter and discovered the large-scale smuggling and melting of these coins. In response, RBI decided to make significant changes to the ₹5 coin. The new ₹5 coins feature a different metal composition and are thinner than their older counterparts, reducing their metal value and making them less attractive for illegal activities.
Conclusion
Despite rumors, ₹5 coins are still in circulation, but older versions have become scarce due to RBI’s strategic modifications. The government and RBI continue to monitor currency trends to prevent misuse and ensure a stable financial system. If you have ₹5 coins, they remain valid for transactions, but you may notice changes in their design and composition over time.
