MONEY»
Central bank gets tough against dirty banknotes
KATHMANDU, SEP 05 -
Nepal Rastra Bank (NRB) has stopped accepting bundles of banknotes from banks and financial institutions (BFIs) bearing multiple stapler marks in line with the clean note policy included in the monetary policy of 2009/10.
“Rejection of paper money with many stapler marks is just the first stage in implementing the policy,” said NRB spokesperson Gopal Kafle. On August 15, the central bank had issued a notice regarding the clean note policy to BFIs as they are the channel of distribution of notes in the market.
“With the announcement of the policy, the number of stapler marks has significantly declined in banknotes arriving at NRB,” said an NRB official. “However, BFIs are yet to reduce the practice of stapling bundles of notes.”
BFIs usually staple bundles of banknotes over and over again which reduces their durability. The objective of the central bank’s move is to check improper
handling of paper money so that the economy gets clean and high quality banknotes, said Kafle.
Stapling reduces the life span of paper money and increases the cost for the central bank as fresh banknotes have to be printed more frequently, said an NRB official.
The programme to remove damaged banknotes from circulation is divided into three stages, added the official. In the second stage, soiled notes will be taken out of the economy. “The first stage is achieving success with the cooperation of BFIs.”
Most of the banknotes in circulation are in bad shape. They are torn, joined by tape or have been scribbled upon. Some notes are even smeared with blood, oil or vermillion as they are used in religious rituals. NRB has categorized such notes as soiled notes which will be removed in the second stage of the programme.
“Another reason for getting rid of dirty banknotes is to encourage the practice of proper handling,” said Kafle.
The technical committee is working on fixing the date for the beginning of the second stage of the programme to be able to meet the deadline of mid-April when soiled notes and notes bearing the portrait of former monarchs will be eliminated from the economy, the NRB official added.
NRB has been working out stop
circulation of banknotes bearing the portrait of past kings as the country has been declared a republic.
Posted on: 2010-09-06 07:57
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