Unusable PH coins
Last week, the Bangko Sentral ng Pilipinas (BSP) reported seizing P50 million worth of P1 coins in various design series in a warehouse in Quezon City.
In the wake of that incident, it called for the enactment of a law that would penalize the hoarding of large volumes of coins because it “results in the inefficient circulation of coins and prevents their primary use as a medium of exchange.”
Until the persons responsible for the coin accumulation are arrested, we can only speculate that the coins are meant to be melted to get whatever valuable metal content they have.
The BSP has reason to be concerned about the undue accumulation of coins because their shortage would require the minting of additional coins, which is not cheap.
Note that the BSP’s New Generation coin series in circulation at present consists of and features President Manuel Quezon (P20), Apolinario Mabini (P10), Andres Bonifacio (P5) and Jose Rizal (P1), with the P0.25, P0.05 and P0.01 coins bearing photos of endemic Philippine flora.
Prior to the new series, in 1995, the BSP issued coins in denominations of P10, P5, P1, P0.25, P0.10, P0.05 (which has a hole in the middle) and P0.01. These coins continue to be legal tender or can be used to meet financial obligations.
The New Generation coin series did away with the P0.10 coin, “plugged” the hole in P0.05 and, most importantly, changed the coins’ metal content to stop their smuggling to extract their nickel content.
The removal of the P0.10 coin from circulation was hardly noticed by the public and did not cause any ripple in the market. It was one less coin to be bothered about.
There is no question that coins are essential in daily commercial transactions, especially for the D and E sectors of our society who buy goods in cash and small increments, and do not have the capacity to maintain credit cards.
But the reality on the ground is, except for the P1 and P0.25 coins, the P0.05 and P0.01 coins are largely ignored or considered not worth keeping unless the paying party is extremely short of cash.
This does not come as a surprise because those two coins are quite small in size and their values are difficult to see when they become rusty.
In public stores and markets, it is common practice for vendors to set the prices of their products in amounts that would not require them to receive payment or give change in those denominations. A buyer who pays with those coins is apt to invite a smirk on the vendor’s face or a subtle reprimand.
The inconvenience of keeping these coins or figuring out their values often prompts their recipient to give them back to the cashier or, if there is a donation can for charity around, drop them there. The act of charity is motivated by a disrespect for the value of the coins.
Of course, if payments are made through debit or credit cards, dealing with those coin denominations is not a problem.
Try giving P0.05 and P0.01—or even P0.25 coins—to street children and chances are, they would throw them away when their giver is out of sight.
What’s more, when those coins are seen lying on the ground, rare is the person who will pick them up. For the artistically-inclined, however, they are suitable articles for bracelets, ornaments or other thingamajigs.
The shabby treatment of those coins is uncalled for, but that’s the truth. Recall that some years back, the then Central Bank of the Philippines launched a campaign dubbed “Respect the Centavo.” In spite of the hoopla made to promote it, that effort did not accomplish its objective.
In light of the generally low regard for or dismissive (and sometimes contemptuous) attitude towards P0.05 and P0.01 coins, it’s doubtful if it makes good business sense to continue minting them and, in effect, compelling their use in whatever commercial transactions they may be useful to.
The money that can be saved from discontinuing those coins could be used by the BSP to further strengthen the security features of the coins and notes it issues.
Obviously, dropping those coins from circulation would not sit well with coin collectors. But who cares. INQFor comments, please send your email to [email protected].
