The Bangko Sentral ng Pilipinas (BSP) is increasing the fees it charge on banks’ deposits and reinstating fees for withdrawals of cash transactions as part of its Clean Note and Coin Policy (CNCP) and to improve the circulation of fit banknotes.
Based on Circular No. 1106, the BSP is restructuring the service fees to P200 per bundle for fit banknotes and P240 per bundle for mixed banknote deposits, up from the previous fees of P100 and P120, respectively.
The new applicable fees for fit banknotes found inserted in unfit banknotes is P300 per bundle from P100.
In the meantime, a new service fee of P240 per bundle will be charged for unfit banknotes found in fit banknotes, according to the circular which was signed by BSP Governor Benjamin E. Diokno on Wednesday.
Charging banks a service fee improves circulation of new or fit banknotes as well as retire unfit banknotes.
Unfit banknotes or "dirty money" are mutilated and hardly recognizable as legal tender. Unfit banknotes deposits with BSP will remain free of charge.
The new circular not only increased the fees for deposits transactions and reinstated the service fees on new and fit banknote withdrawals, but also imposed provisions for rebates, refunds and incentives for unfit banknote deposits, as well as a penalty for cancelled withdrawal transactions.
The restructured service fees will be implemented 15 days after the publication of the circular in newspapers. The central bank’s regional offices and branches will charge the new fees starting June 1, 2021.
Last year, the BSP adopted rules for a stronger CNCP to discourage mutilation or defacement of banknotes and coins. Such acts are considered criminal and punishable by a fine of not more than P20,000 and/or imprisonment of not more than five years.
The BSP has been encouraging banks to accept unfit banknotes from the depositing public as well as non-mutilated coins “without handling fees or charges” and then to re-circulate such coins. However coins that are corroded should be withdrawn from circulation.
The BSP consider banknotes as fit when it meets the following requirements: prints are clear and “genuineness is obvious”; without writing and/or heavy creases; and banknotes that can maintain their upright position when held at the mid-portion of one of the shorter borders.
Unfit notes are banknotes that do not qualify as fit notes while mixed banknotes are deposits which is a combination of fit and unfit notes in a bundle.