BSP: Coin hoarding could hurt consumers

CEBU, Philippines - The Bangko Sentral Ng Pilipinas (BSP-7) has warned against hoarding of coins, as this could affect the trading activities and could ultimately hurt the consumers in general.

BSP-7 is now working with the Cebu Bankers Club Inc. (CBC) to encourage the major coin hoarders such as the Automated Tubig Machines (ATMs), Piso-Piso Internet Machine, coin-operated Karaoke, and the illegal Karera machine, and other vending machines, to use tokens, instead of coins.

In a press briefing, BSP-7 Maria Luz T. Berciles said that there is a need for consumers to circulate the coins in the system, as it could ultimately affect the consumers.

She said if the system is experiencing shortage of coins in the circulation, consumers will be forced not to get their centavos change from retail outlets, transportation facilities, thus affecting the cost of living in the long run.

A consumer for instance, is entitled to get his/her change even as small as five centavos or 25 centavos from a retail outlet, public transportation facilities (jeepney, taxi), if this scenario will not be addressed, consumers are bound to be victims of coin scarcity.

Berciles also urged consumers to break the culture of keeping “piggy-bank” at home, as this is considered as coin hoarding activity.

“It is very important that we will not keep our [available] coins at home, or let it idle for some time. It has to be circulated in the system. Otherwise, consumers will also become the victim of this activity,” Berciles said.

To curb this problem, BSP-7 sought the help of the CBC to encourage consumers to circulate the coins in the system, and also provide attractive packages and products so that those that are maintaining piggy-banks at home will put their money in the bank.

“We want people to empty their drawers, and change the habit of keeping piggy banks at home,” Berciles said stressing that this activity contributes to crippling the trading movement.

CBC president John Salas vowed to help BSP-7 on this campaign, and agreed to help BSP in formulating effective campaign or program that will also convince operators of automated machines, vending machines, to use tokens instead of coins.

BSP and CBC also mulled at working closely with barangay officials, or the LGU executives in identifying the large coin hoarders within their respective communities, so that together they could formulate solutions to curb the coin hoarding problem.

“Maybe we could start over a small locality, and that could catch on. The primary objective is to make people aware that keeping coins could general affect the entire trading system,” Salas said.

In a severe coin shortage scenario, the consumers can not move anymore. Scarcity of coin within the system is detrimental to daily movement of consumers, commuters, and traders.

Before, the Philippines or Cebu could experience this state, BSP-7 together with CBC are actively moving in order to maintain a healthy trading system.

As of December 2009, there were 15.6 billion pieces of coins with a total face value of P16.9 billion. About 88 percent of total coins in circulation are low-denomination coins; the 25 centavos, 10 centavos, five centavos, and one centavo.

Based on 15.6 billion coins in circulation as of December 2009 and an estimated population of 92.2 million, the ratio of coin to population is 169 coins for each Filipino.

If BSP will include the 8.7 million Filipinos working abroad, the ratio moves up to 186 per head.