MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) aims to circulate 500 million pieces of the polymer version of the P1,000 banknotes by 2023 as part of the ongoing limited circulation test.
The central bank has started the phased issuance of polymer banknotes to banks with an initial release of 10 million pieces to be made available to the public.
So far, the number of P1,000 polymer bills released in the financial system represents two percent of the total polymer banknotes to be circulated and 0.7 percent of the estimated combined number of P1,000 paper-based and polymer banknotes in circulation.
BSP Governor Benjamin Diokno said that there would be no demonetization of currently circulating banknotes and coins during his term.
Prior to the release, the BSP has already conducted technical briefings for bank personnel, machine suppliers, and cash-in-transit service providers to educate them on the design and security features of the polymer banknotes.
The central bank is finalizing a memorandum of agreement (MOA) to spell out the guidelines of the issuance of the polymer banknotes. It aims to cover matters such as polymer familiarization by client banks’ personnel and calibration of existing cash processing machines, vending machines, automated teller machines, bills acceptors, and other similar devices for compatibility with polymer banknotes.
According to the central bank, the test would help determine the effects of polymerization on hygiene and public health, environmental sustainability, as well as the lifespan, durability and counterfeiting rates.
The BSP aims to collect stakeholder feedback and observe changes in currency handling behavior.
The BSP earlier partnered with the Reserve Bank of Australia for the printing of the plastic banknotes through Note Printing Australia.
Close to 60 countries have ventured into the use of polymer substrates among advanced economies including Canada, Australia New Zealand as well as Malaysia, Vietnam, Mexico, and Fiji among emerging and developing economies.
Last year, the BSP revived plans to use plastic or polymer to print banknotes that is more hygienic amid the pandemic, more environment friendly, as well as more durable and secure than the cotton and abaca fiber composite being used now.
In line with the BSP’s mandate and global good practice, it explored the adoption of polymer banknotes.
Polymer banknotes are significantly cleaner and less susceptible to viral and bacterial transmission due to their smooth and non-absorptive surfaces.
Data showed the share of P1,000 banknotes to total volume of currency in circulation reached 33 percent as of end 2021. It is also most susceptible to counterfeiting, accounting for almost half of the volume of the documented counterfeit banknotes last year.