BSP Coin Recirculation Program
The Monetary Board of the Bangko Sentral ng Pilipinas (BSP) created on March 2005 the Currency Management Committee (CuMC) to address problems arising from the circulation of Philippine currency.
In its first meeting held on 21 March 2005, the then Deputy Governor Amando M. Tetangco, Jr., the first chair of CuMC stressed that the creation of the committee has become imperative in view of the following concerns:
- the perceived shortage of coins in some regions of the country;
- the indications that coins are not being recirculated effectively; and
- the need for the BSP to produce more coins which would translate into significant costs because coin production entails negative seigniorage, i.e., the intrinsic value of the coin is greater than its nominal value especially for the lower-denominated coins, the 25-; 10-; 5-; and 1-sentimo.
As of 31 December 2005, there were 11.1 billion pieces of coins in circulation, 6.7 billion pieces of which were low-denomination coins. This brought coins per capita to 121, way above the ASEAN standard of 50 pieces. Yet, demand remains unfilled in many parts of the country because coins are not being recirculated, or used regularly by the public. Coins are kept inside bank vaults, in piggy banks, inside drawers, used as washers, or thrown away as inconvenience.
The former Chair also emphasized that CuMC's main objective is to ensure efficient production, delivery distribution and circulation of notes and coins consistent with the requirements of the economy, and other related activities. He advised the committee to consider the possibility of encouraging banks and other sectors of society to help in BSP's efforts to effect an efficient recirculation of our coins.
Deputy Governor for the Monetary Stability Sector Diwa C. Guinigundo assumed the chairmanship of CuMC when Mr. Amando M. Tetangco Jr. took his oath as the new BSP Governor on June 2005, succeeding Rafael B. Buenaventura.
Deputy Governor Guinigundo sees the urgency of the problem and promptly buckled down to work on the implementation of the BSP Coin Recirculation Program. The CuMC met with representatives from the Bankers Association of the Philippines (BAP), Chamber of Thrift Banks (CTB), Rural Bankers Association of the Philippines (RBAP), Bank Management of the Philippines, Philippine Retailers Association (PRA), Pondong Pinoy, and representatives from other charitable institutions to present the program and get their reaction.
The banking sector as represented by the BAP, CTB, RBAP and BMAP, being the intermediary between BSP and retailers/consumers, is a key stakeholder in the Coin Recirculation program. The retail sector as represented by PRA which has the highest demand for coins particularly the lower-denominated ones, is another key stakeholder. Pondong Pinoy and other charitable organizations collecting coins in cans, on the other hand, have voiced out the problems they encounter in collecting coin donations and depositing them in banks.
The low regard towards lower-denominated coins is one of the main reasons coins are not circulating efficiently. Schoolchildren as agents of change in their homes and communities, however, can generate better appreciation of the use of coins. For this reason, the participation of schools and schoolchildren is deemed crucial for the program's success. The program will also give pupils the opportunity to exercise civic responsibility. Furthermore, certain disciplines within Makabayan may be entry points by which positive values like pagkamasinop, pagkamatipid, pag-iimpok and pagkakaisa can be instilled among schoolchildren in the Elementary Level.
In a Memorandum of Agreement (MOA), BSP Governor Amando M. Tetangco, Jr. and Department of Education (DepEd) Officer-in-Charge Fe A. Hidalgo agreed to be partners in implementing BSP's Coin Recirculation Program. In the MOA, schools will help instill the values needed for our coins to recirculate efficiently anchored on the program's theme: Ang Barya, Mahalaga . Present during the MOA signing held recently at the BSP Executive Business Center are DepEd Undersecretary Manaros B. Boransing; DepEd Assistant Secretary Teodoro R. Catindig; Dep. Gov. Nestor A. Espenilla; MB Member Vicente B. Valdepeñas, Jr.; Dep. Gov. Diwa C. Guinigundo, Chair, Currency Management Committee; and Dep.Gov. Armando L. Suratos, Co-Chair, Currency Management Committee.
A similar MOA by and among the BSP and the stakeholders in the banking and retail sectors will be signed during the Bankers' Reception on 17 January..
All the stakeholders in the Coin Recirculation Program agreed that the drive towards a more efficient recirculation of our coins would be achieved only if all sectors of society fully realize the importance of coins and cultivate the habit of regularly using them in giving payments and exact change, and engaging in altruistic activities. Hence, the CuMC embarked on a public awareness campaign.
BSP commissioned NBN-4 to produce a 30-second TV ad on the importance of recirculating coins. The ad has been aired for free in four channels. Thanks for the deep sense of civic responsibility and generosity of Channels GMA-7, ABS-CBN-2, ANC-21, and NBN-4. Production of other promotional materials like poster, t-shirts, decals, and book markers is now on-going.
To set the example in coin recirculation and help Gawad Kalinga (GK), CuMC conducted in November a coin recirculation contest among BSP employees. The contest is aimed at developing awareness among BSP personnel on the Coin Recirculation Program and flushing out coins kept idle in cans, plastics, boxes, cups, or glasses in cabinets, or drawers. More than a million low-denomination coins were collected. Top three departments gathering the most number of lower-denominated coins in the "gross" and "per capita" categories each received a trophy during BSP's Christmas Program held at the PICC. In the same event, checks totaling P366,340.57 representing the coins collected and cash donations from employees, which is good for seven (7) GK homes, were also turned over to Fr. Bienvenido Nebres, President, Ateneo de Manila University and GK Site13 Project head. The Philippine Retailers Association exchanged the coins with checks.
The CuMC hopes to replicate the campaign in public and private elementary schools nationwide with the schools as the main beneficiaries and in other government agencies.