Approximately 519.93 metric tons of “unfit, demonetized, mutilated and counterfeit” (UDMC) coins have been retired, according to the Bangko Sentral ng Pilipinas (BSP), which announced this on Nov. 3; the defacement process began in October of last year and will last until September 2022.
Coins that have rusted, lost weight owing to wear and tear, or are bent or twisted out of shape are deemed unsuitable. According to the BSP, coin defacing is now done mechanically, and depending on the amount of metallic content, the coins can be recycled. To prevent coins from being recirculated, a practice known as defacement “alters the surfaces of coins.”
About 364 metric tons, or about 70%, of the defaced UDMC coins, were deemed unsuitable coins, while 128 metric tons, or about 25%, were mutilated. One percent of the total, or seven metric tons, were demonetized, and another 4%, or 21 metric tons, were counterfeit.
According to the BSP, it retires UDMC coins to preserve the credibility of Philippine money.
The BSP also stated that it was seeking the passage of legislation that would define and punish excessive and pointless coin hoarding as part of its ongoing efforts to uphold and safeguard the integrity of Philippine currency.
The BSP aims to make storing huge quantities of coins a crime and implement a more stringent set of penalties and sanctions against currency forgery.
The BSP has been advocating for a strict rule that will criminalize coin hoarding in the nation in response to this. The BSP uses its Coin Recirculation Program to persuade the public to avoid needlessly hoarding coins in the absence of legislation.
According to the BSP, coin hoarding inhibits coins from being used as a major medium of trade and leads to inefficient currency circulation. Due to the widespread practice of keeping coins inactive in bank vaults, drawers, and piggy banks rather than redistributing them, an artificial shortage of coins may also develop.
According to Republic Act No. 7653, as amended by RA 11211, “BSP shall retire or destroy all Philippine banknotes and coins proven to be unsuitable, disfigured, or demonetized, including seized counterfeits,” according to a statement released by the BSP on Wednesday. This will guarantee that the coins and banknotes used to pay for goods and services are only acceptable legal currency.
As a part of its campaign to encourage and enhance its use and circulation, the BSP has already issued a warning to the general public advising them to exchange or deposit unsuitable coins. According to BSP authorities, proper management of coinage also aids in preventing unauthorized usage.
Unfit coins can be exchanged or deposited by the general public, while coins with questionable authenticity can be turned over to banks for BSP inspection. If found to be unfit, the aforementioned coins will be taken out of circulation.
The BSP has a Coin Recirculation Program and a Clean Note and Coin Policy. Reminding the public that “willful defacement, mutilation, burning, or destruction of coins may be subject to imprisonment of up to five years” as well as a fine of P20,000 is a regular part of its advise.
