The State Bank of Vietnam (SBV) has been seeking Government approval for a plan to issue small face-value banknotes to deal with forgeries.
The SBV Deputy Governor Nguyen Thi Kim Phung said at a seminar last week that the bank is considering issuing VND10,000 and VND20,000 polymer banknotes to replace the cotton ones, which are claimed to be too old and crumpled, and do not meet technical requirements.
The SBV has asked credit institutions to supply four face value banknotes in their ATMs, including small denominations; however, many refused to use cotton notes.
Nguyen Chi Thanh, Head of the SBV’s Issue and Vault Department, said that to avoid ATM obstructions, banks have to sort old notes by hand.
In such a high humid environment, the average life expectancy of cotton bank notes is approximately 1.5-3 years, he said.
Moreover, forgeries of small paper denominations are difficult to detect with bare eyes and normal equipment like ultraviolet lamps, Thanh said, adding that in January and April this year fake VND50,000 and VND100,000 notes were found because they looked like paper notes.
Vuong Dinh Tuong from the Ministry of Police, admitted circulation and use of forged money was widespread adding over 120 gangs, involving hundreds of people including five foreigners, had been busted this year.
Vietnam first launched polymer notes in 2003 in two denominations, VND50,000 and VND500,000 and put VND100,000 polymer bills in circulation in 2004.
Besides many strong points of the polymer notes, they also have some disadvantages, such as the notes being difficult to fold, or becoming easily deformed by high heat.
Furthermore, Vietnam has to be independent from materials and technology imported from New Zealand, Phung from the SBV said.
In related development, the SBV has set up a taskforce in charge of preventing and fighting forgeries of banknotes.
P.V
Vietnamese
