MANILA, Philippines — Senators and farmer groups yesterday warned of the adverse impact on the environment and the economy if the Bangko Sentral ng Pilipinas (BSP) fully implements its controversial plan to issue new polymer banknotes, which it claims are recyclable and have a low carbon footprint.
Concerns on the issuance of new polymer banknotes were raised during a hearing of the Senate committee on banks, financial institutions and currencies, chaired by Sen. Mark Villar, in pursuit of the resolution filed by Senate Minority Leader Aquilino Pimentel III seeking a probe into the BSP’s plan.
Villar said the inquiry aims to weigh the pros and cons of the recent initiatives of the BSP and provide recommendation or legislation on what is most beneficial for all Filipinos.
He noted that in 2018, the BSP introduced the new generation series of banknotes and less than 10 years later, the central bank is introducing another bank note using a new material, polymer, which may affect the abaca industry and poses important questions on sustainability and plastics disposal.
“This raises the question, is this change necessary at this point? How many incidents of counterfeiting on our new generation series have occurred in the past four years? Are the security features in the new polymer series better than the new generation series?” Villar asked.
He noted that the government might be wasting money and causing unnecessary inconvenience to the public by changing banknotes in a span of four years, or from 2018 to 2022.
Pimentel said there was lack of consultation and apparent haste in the issuance of the new banknotes, which actually “felt fake” to many of those who have handled them.
Sen. Pia Cayetano, who chairs the Senate committee on sustainable development goals, innovation and futures thinking, questioned the BSP’s claim that polymer bills use less water and can be recycled into chairs and tables.
Robert Atienza of the Philippine Fiber Industry Development Authority told the committee that the agency has long opposed the BSP’s plan, adding that Japan and the US continue to use paper bills.
Atienza said the shift to polymer would be “very costly” for banks and other financial institutions that handle cash as they have to recalibrate and purchase new equipment, like ATMs, that may not read and handle the new material.
Federation of Free Farmers Cooperative chairman Leonardo Montemayor said the BSP appears to have violated the Constitution, which mandates the use of local products as much as possible.
Montemayor said farmers have welcomed President Marcos’ recent pronouncements on boosting agricultural productivity but they are now disheartened by the BSP’s move.
As Marcos has appointed himself agriculture secretary, “he has a chance now to reverse whatever to our mind is not the proper thing to do, which was done in the previous administration,” Montemayor said.
BSP officials led by Deputy Governor Mamerto Tangoan defended the project even as the central bank is still awaiting the results of its test distribution of some hundreds of millions of pesos worth of P1,000 polymer notes.
Tangoan said under the law, the BSP has the exclusive power and authority to issue currency, including prescribing denominations, dimensions, designs, inscriptions and other characteristics of currencies.
“The BSP must ensure that our currency is secure against serious counterfeiting and that the needs of the Filipino people are served and the BSP continuously seeks ways to improve the quality of Philippine bank notes for the greater good,” he said.
“Public concerns on hygiene, particularly during the height of the pandemic, the advancement in counterfeiting technology and growing awareness and need for environmental sustainability prompted the BSP to search for alternative banknote substrates that are responsive to the emerging needs of Philippine society,” he said.
He added the Department of Health also suggested the shift to polymer banknotes to reduce the survival time of bacteria and viruses in bills.