Giving the buyer value for money
By M.R. Pai

THE second principle of consumerism is value for money.

There is nothing surprising if every consumer asks for value for the money he spends. Going back to the basics of economics, what is money? It is a medium of exchange. When you borrow a kilo of sugar, you have to return that much sugar. More conveniently, you may return any other commodity of equal value. Later on, when such barter became complex, the money economy started. In the exchange economy, you paid the value of a product in terms of quantum of money which would buy equivalent quantity. Today, if the consumer asks for value for his money, he is merely reasserting his right of getting the full value of the transaction.

Though everyone uses money, few know how to handle that money, and some important aspects of money. Here are a few tips.

If you deal with coins, only up to Rs 20 is considered to be legal tender. If you pay the price only in coins, the seller has no obligation to accept change beyond Rs 20.

You use currency notes, more accurately, bank notes because they are issued by the Reserve Bank of India which has the monopoly of issuing those notes.

They are in denomination of Rs 10, Rs 20, Rs 50, Rs 100 and Rs 500. Printing of Re 1, Rs 2 and Rs 5 has been stopped. These have been coinaged, which is a worldwide trend as coins last longer, while currency notes become soiled and have a shorter lifespan. Rs 1,000 notes are expected to be introduced shortly.

A common problem faced in India is refusal by banks and others to accept soiled notes. It is, therefore, useful to know the characteristics of legal tender.

As per RBI Note Refund Rules, notes having the signature of the Governor of the Reserve Bank of India, the denomination in figures and words, serial number, Ashoka pillar or, on new notes, Mahatma Gandhi’s picture and watermark is a legal tender if there is no substantial mutilation. However soiled such a note may be, it is still legal tender. It has been issued by the RBI against the Rupee Securities of the Government of India. Therefore, refusal to accept such notes is an offence as it is tantamount to questioning the financial integrity and solvency of Government of India, and also amounts to undermining public confidence in the currency of the country. A complaint should be lodged in a nearby police station, giving all details.

Banks are adept in passing on to customers such soiled notes, but refuse to accept them. Under the RBI Note Refund Rules, it is mandatory for banks not only to accept them but also exchange soiled notes for good notes. They have no choice.

Reserve Bank of India Note Refund Rules booklet is nominally priced and may be obtained from Manager, Publications Division, Reserve Bank of India, Amar Building, Perin Nariman Street, Mumbai 400 001.