Cost of minting a One-Rupee coin is more than its face value, the cost is…, cost of making Rs 2, Rs 10, Rs 2000 is…
It might come as a surprise, but the cost of minting a one-rupee coin in India is higher than its actual value. According to a 2018 disclosure by the Reserve Bank of India (RBI) in response to an RTI query, the production cost of a one-rupee coin is Rs 1.11.
The disparity between production costs and face value extends to other coins as well: Rs 2 coin costs Rs 1.28 to produce. Rs 5 coin costs Rs 3.69. Rs 10 coin costs Rs 5.54.
Why Do Coin Actual Value Differs?
The one-rupee coin is made from stainless steel, with a diameter of 21.93 mm, a thickness of 1.45 mm, and a weight of 3.76 grams. These coins are minted by the Indian Government Mints (IGM) in Mumbai and Hyderabad. While the Hyderabad Mint disclosed the costs, the Mumbai Mint cited confidentiality under Section 8(1)(d) of the RTI Act, 2005, and refrained from revealing the data.
Who Prints Currency?
In India, the responsibility for printing currency is divided between the government and the Reserve Bank of India. Coins and the Rs 1 note: Printed exclusively by the Government of India. Notes from Rs 2 to Rs 500: Printed by the Reserve Bank of India. Rs 2000 notes previously printed by the RBI, are now being withdrawn from circulation.
Printing Costs for Currency Notes
The cost of printing notes varies based on denomination. Here are the production costs for 1,000 notes in various denominations:
- ₹10 notes: ₹960
- ₹100 notes: ₹1,770
- ₹200 notes: ₹2,370
- ₹500 notes: ₹2,290
Interestingly, it cost approximately ₹4 to print a single ₹2000 note before they were discontinued.
This revelation highlights the complexities and costs involved in currency production. While the face value of coins and notes represents their purchasing power, their manufacturing process involves raw materials, machinery, and labor, contributing to the overall expense.
Despite the higher production cost, coins and notes remain essential for India’s economy, ensuring the smooth functioning of transactions across all levels of society.