To ensure adequate supply of physical money during the pandemic, the Bangko Sentral ng Pilipinas (BSP) outsourced 62.2 percent of banknotes from foreign printers last year, printing only 34.7 percent locally, according to a BSP report.
This is in contrast to what is considered “normal times” when BSP will print most of the country’s banknotes requirements. In 2019 it produced 65.7 percent of banknotes and only outsourced 34.3 percent.
The BSP outsource currency printing as a temporary stop-gap measure to meet surges in currency demand such as in the 1,000-piso and 500-piso. Last year, when the COVID-19 health crisis forced its Security Plant Complex (SPC) in Quezon City to implement reduced workforce as part of health protocols, it had to outsource most of its banknotes.
The BSP said they have ensured there was undisrupted cash circulation last year despite the lockdown and stringent health and safety restrictions, and that they have “continued to be at the forefront of public service through the timely and uninterrupted provision of banknotes and coins to support critical economic transactions.”
“In line with the sole power and authority to issue Philippine currency, the BSP provided undisrupted currency withdrawal services to banks amidst the heightened lockdowns in key regions,” the BSP said, referring to its cash department operations. It said that in Metro Manila alone, during the height of the lockdown when there was limited manpower, they were able to supply 97 percent of the currency volume requested by banks.
Based on the report, the BSP delivered 3.685 billion pieces of banknotes in 2020, of which about 2.285 billion pieces or 62.2 percent were outsourced finished banknotes.
The BSP in July last year also delivered some 655 million pieces of enhanced New Generation Currency or eNGC banknotes with improved security threads, from 100 piso up to 1,000-piso. The 20-piso banknote is not included since the BSP has already started its shift to the 20-piso.
As for mint money, the BSP was able to produce most of the country’s coin requirements in 2020, minting 73.8 percent in-house while 26.2 percent of minted coins were outsourced. There were 1.329 billion pieces of minted coins last year. In the meantime, some 29 million 20-piso coins, the highest-denominated coin, were circulated in 2020.
The BSP said the 20-piso coin is more cost-efficient to make and it has a longer circulation life than a 20-piso banknote. The BSP has not yet announced what it plans to do with the 20-piso banknote but both the 20-piso coin and its banknote version will continue to be circulated together until the 20-piso paper money is “removed from circulation through natural attrition.”
In September last year, there was an alleged 1,000-piso with an incorrect spelling of President Rodrigo Roa Duterte’s name on it, that instead of Roa, it was spelled “Boa”. This was reminiscent of a similar bill that misspelled the name of former President Gloria M. Arroyo as “Arrovo”.
The BSP acknowledged the “Arrovo” banknotes which were outsourced finished banknotes. However the central bank said the “Boa” banknotes is not their own, and that it was not recognized as legal tender because it did not come from SPC, after it traced the serial number shown in the said banknote which does not match any of the ones issued by the BSP.
In 2005, banknotes were circulated with the misspelled “Arrovo”. These banknotes were outsourced to a French printer, Oberthur Technologies (Francois Charles Oberthur Fiduciare), one of the biggest banknotes printer in the world. Some P2 billion worth of the “Arrovo” bills or 77.908 million pieces were circulated and these were never replaced.