MANILA, Philippines – The money in your wallet could soon be collectors’ items as central bank officials start considering using plastic instead of the abaca fiber and cotton composite used to print bank notes.
The Bangko Sentral ng Pilipinas (BSP) is considering the possibility of issuing polymer money – a much more expensive but durable replacement for paper.
Central bank officials are also studying the possibility of restructuring the denomination of Philippine money that could lead to the official phase-out of five and ten-peso notes.
BSP Deputy Governor and officer-in-charge Armando Suratos said Australia has proposed that Philippine officials consider the possibility of shifting to polymer.
Australia is the first country to have a full set of circulating polymer banknotes of all denominations.
“They proposed to us to start using it and we’re studying the pros and cons,” Suratos said, adding that there were countries like Thailand that issued one denomination using polymer and had “a bad experience”.
Suratos admitted polymer notes would have longer lifespan than cotton and paper but it was also more expensive. “We also have to consider how people handle bills,” he added.
Aside from being more durable, polymer banknotes could also prevent counterfeiting because it would allow banknote manufacturers to incorporate security features, such as optically variable devices that were extremely difficult to reproduce.
Suratos explained that the BSP currently prints money using a fiber composite of 20 percent abaca and 80 percent cotton for added durability.
Suratos said the use of abaca fibre was deliberate, in order to support the local abaca fiber-exporting industry. He said the BSP specifically requires offshore banknote manufacturers to use Philippine abaca.
“We make sure Philippine abaca is used, not just any material,” he said. “We ask them to certify their suppliers.”
Suratos explained that the BSP outsources the master die used in printing bank notes but the central bank itself makes the plates for their security printing plant.
Suratos said the Philippines used to import paper bills but has since started printing its own banknotes unless the demand was so large as to exceed the current plant capacity.
Although the plans have not left the drawing board, the BSP has also begun considering changing all the designs on the country’s legal tenders, possibly whether or not the BSP would ultimately decide to replace paper with plastic.
Suratos said part of the study is to determine the denominations still needed for transactions. For instance, all five-peso and 10-peso bills were still legal tenders but the central bank has already stopped printing them.
“We have decided that in the new denominations there will be no more five- and ten-peso bills but in coins only,” he said.
Aside from Australia, other countries also use plastic bank notes such as Bangladesh, Brazil, Brunei, Chile, Indonesia, Israel, Malaysia, Mexico, Nepal, New Zealand, Papua and New Guinea, Romania, Singapore, the Solomon Islands, Sri Lanka, Thailand, Vietnam, Western Samoa and Zambia.
Other countries issue commemorative polymer notes, including China, Kuwait, the Northern Bank of Northern Ireland, Taiwan and Hong Kong.