Sunday, August 08, 2010

BSP Currency Saga Continues: New Series of Philippine Peso BanknotesShare

(Reposted from Lamang Lupa)

Monday, August 2, 2010 at 12:12pm

In 2009, the BSP announced plans for the issue of a full series of new peso banknotes ("New Generation Currency").

In February 2010, the BSP's Numismatic Committee invited potential suppliers for a briefing about the New Generation Currency and the requirements for banknotized sketches, origination and printing. In April, the BSP accepted the sketches submitted by De La Rue, as well as De La Rue's offer to provide the origination free-of-charge. The other potential suppliers were advised by the BSP that their services were no longer required in this regard.

The design of the new series and additional security features will make it technically impossible for the SPC to produce these banknotes with its current equipment. Unless new printing equipment is installed at the SPC, the BSP will have no other choice than to buy all the New Generation banknotes from foreign printers.

The BSP plans to introduce the full New Generation series in one shot, issuing, by the end of 2010, five million banknotes of each denomination. As this initial issue will not be sufficient to meet the country's currency requirement, the BSP will have to place very large additional orders for finished banknotes in 2011. It may be assumed that the BSP will announce the tender for the initial batch of finished New Generation banknotes (based on De La Rue's banknotized sketches and origination) in the coming months and that subsequent tenders will be announced periodically thereafter.

Significantly, almost all countries introduce their new banknote series sequentially, i.e. one denomination every three to six months or a year, which allows testing public acceptance, adjusting the cash operations of commercial banks, correcting any issues that may occur with one denomination and improving the implementation of subsequently released denominations. And they spend time in planning and testing. In the case of the new US $100 dollar note, the US spent some five years of preparation and testing. The same happened with the issuance of new series of Swiss Francs and Euros.

In the case of the Philippines, the BSP is undertaking a total makeover of the country’s currency, and it is doing it after just over a year of preparation. No one understands the big hurry.

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