Nearly 97 per cent of the 500- and 1,000-rupee notes demonetised by the government on November 8 have been deposited in banks, Bloomberg reported.
The last date for depositing the old notes was December 30.
Banks have received 14.97 trillion rupees ($220 billion), sources "with knowledge of the matter" told Bloomberg.
The Indian government had estimated around 5 trillion rupees out of a total of 15.4 trillion rupees, outlawed by Prime Minister Narendra Modi’s surprise demonetisation move, would not make its way back to the banks and remain undeclared for fear of coming under the tax scanner.
A near-full validation of the old notes, the Bloomberg report added, would deal a blow to Mr Modi's plans of getting at the country's "black money", the local term for undeclared or untaxed money.
Mr Modi's surprise demonetisation has made things difficult for millions of people. It has forced them into long queues, people have found it difficult -- without cash -- to get hold of food and medicines, and farmers -- again without cash to buy seed and fertiliser -- have been unable to sow their winter crop.
And the demonetisation might also have hurt the economy.
According to Bloomberg, private indicators published over the past week signal that the $2 trillion economy will be hurt by the clampdown on cash.
The Nikkei India Services Purchasing Managers' Index shrank in December, the second straight month of contraction, Bloomberg said citing a report.
The Bloomberg report added that since the demonetisation, banks have doled out 8 trillion rupees in new currency notes.
The figures of bank notes deposited are provisional and may change, it also added.