April 9, 2010

Bangko Sentral released Currency Redesigning Primer

To meet the demand of the market for a more secured currency, the Bangko Sentral Ng Pilipinas has released a primer for the benefit of the public. The primer was issued last March 26, 2010.

The primer contains "Questions and Answers" that would allow the public to understand the purpose of the changing of the design of the current currency which would eventually takes place this coming year 2011.

1. Why is the BSP changing the designs of our money?

As a matter of practice, central banks regularly change the designs of their money - whether coins or banknotes - to guard against counterfeiters. By making it very difficult and costly for counterfeiters to produce exact copies of our money, we protect the integrity of our currency against criminals.

2. How will BSP prevent the spread of counterfeit or fake money?

The BSP is upgrading the security features in all of our banknotes to make it easier for the public to detect fake money. The BSP will mount a nationwide information campaign to educate our people on how to tell genuine banknotes from counterfeits.

3. When will the new currency be distributed ?

The BSP will start distributing the initial batch of new banknotes in December 2010. New coins will be introduced starting 2012.

4. What denominations are covered by the new designs?

All of our six banknote denominations will have new designs: 20-piso, 50-piso, 100-piso, 200-piso, 500-piso, and 1,000- piso. At the same time, all of our coin denominations will have new designs: 1-sentimo, 5-sentimo, 10-sentimo, 25-sentimo, 1-piso, 5-piso, and 10-piso.

5. What will be the size of the new banknotes?

The size of the new banknotes will be the same as the present currency.

6. What will happen to the existing currency in circulation?

The present banknotes will remain in circulation and will continue to be accepted as legal tender for at least three more years. Based on previous currency retirement or demonetization program of the BSP, this will give enough time for the public to make a full transition to our new generation currency. A separate schedule will be followed for coins. Appropriate announcements will be released before and after the introduction of our new banknotes and coins to guide the public and ensure a smooth transition to our new currency.

7. How does the BSP select new designs and security features for our currency?

The BSP has a Numismatic Committee that initiates new design studies and proposes upgraded security features for consideration by its Monetary Board. Once a selection is made, the Monetary Board sends the proposed new designs for the approval of the President of the Philippines.

8. What are the design elements of our new banknotes?

Our new banknotes pay tribute to Filipinos who played significant roles at various moments of our nation’s history. World heritage sites and iconic natural wonders of the Philippines are also proudly highlighted.

9. What are the designs elements of our new coins?

The new coins will feature our national symbols.

10. What are the considerations in the selection of security features for our new currency?

The BSP did research and benchmarking on security features that are available from global suppliers and are being used by other central banks. The security features range from level 1 to level 4 or from highly visible to hidden security elements that can be detected only by sophisticated equipment. The layered security features are as follows:

Level I : Security features which can be easily recognized by the public without use of special instrument. These are the “look", "feel", "tilt” elements in the notes such as watermark, security thread, security fibers, and others.

Level II: Security features recognizable by professional cash handlers/bank tellers with the use of magnifying lens or ultraviolet light. Examples are fluorescent features and security fibers, microprinting.

Level III: The hidden or covert security features reserved for the use of the Bangko Sentral.

Level IV: Forensic security features for the use of law enforcers in testifying whether a banknote is genuine or counterfeit. Forensic features are detectable at specialized laboratories.

11. Is it costly to change currency designs and security features?

There are additional but relatively minimal costs involved in changing the design and upgrading the security features of our money. To the BSP, the benefits far outweigh the upfront incremental costs involved in shifting to the new designs and to abaca-reinforced paper that will incorporate the new embedded security features.

12. Who will produce our new currency?

In accordance with global practice, the preparation of the metal plates and dies for the production of money is done by highly specialized groups called “originators” who will print the first batch of our new currency. For this, an international competitive bidding will be conducted.

After this, the BSP will start printing our new currency using these origination materials. The BSP is also buying new equipment that will increase its printing capacity to meet the demands of our growing population and economy.

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