Characteristics of Monetary System

Characteristics of Philippine Currency

The Bangko Sentral shall have the sole authority to issue currency within the territory of the Philippines.

No other person or entity can produce notes or coins that can circulate as currrency without the authority/permission of Bangko Sentral.

Notes and coins issued by the Bangko Sentral shall be considered as its liabilities and are fully guaranteed by the Republic of the Philippines.

The Monetary Board which exercises the powers and functions of the BSP, such as the conduct of monetary policy and supervision of the financial system, prescribed the following features of notes and coins:

• a. Denomination - includes the face value of each coin and paper bill.

• b. Dimensions - these are the sizes of coins and paper bills.

• c. Designs and inscriptions - the graphics or text imprinted on each money.

• d. Colors - variations of each color for easy recognition.

• e. Weight - includes the paper weight and metal weight of the alloy for coins.

• The Monetary Board also prescribes the amount of notes and coins printed and minted.

• They are also responsible for contracting institutions, mints and firms for such operations.

• The expenses incurred for printing and minting notes and coins shall be for the account of the Bangko Sentral.

The Bangko Sentral shall exchange, on demand and without charge, a Philippine currency of any denomination for other Philippine notes and coins of any other denomination requested and this refers to the Interconvertibility of currency - replacement of notes and coins with another denomination for the same value.

The Bangko Sentral has the power to withdraw from circulation and demonetize notes and coins which :

• shows signs of filing, clipping or perforation

• have lost of more than 2/5 of their surface, lost serial number and all of the signatures inscribed.

• are more than 5 yrs. old for notes and more than 10 yrs. old for coins.

The said notes and coins are subject for replacement unless its identification is impossible to be recognized. The legal tender for the notes and coins that are called for replacement would be a period of 1 year from the date of call.

The Bangko Sentral maintains a Currency Retirement Division which evaluates the notes and coins that are either subjected for replacement or retirement. After evaluation, the bills will be burned in an incinerator for a week under the supervision of the Bangko Sentral officials.

Early Philippine Coins

During the early times, people used the barter system wherein a person's goods is exchanged with another person's goods.

• The inconvenience of the barter system led to the adoption of certain items as media of exchange.

• Between 8th-14th centuries, the use of gold was intoduced in trading.

• Piloncito was the next developed medium of exchange.

• The inscription in the Piloncito is interpreted as "Ma" which stood as MA-I, a name of the Philippines during tha pre-hispanic times.

Currency during the Spanish Occupation

• TESTON - first European coin brought by the Spaniards in 1521 in the country.– This was the first silver coin ever

seen by the natives.

• GALLEON TRADE- started during the colonization of the Philippines in 1565 and lasted for 250 years was responsible for transforming Manila into a trade center for oriental goods.

• MACUQUINAS or the COBS - irregular, oddly-shaped coins stamped with a cross on one side and a royal coat of arms on the other.– Earliest coins brought to the

country from Mexico. – Circulated from 1585 to 1768.

• DOS MUNDOS or COLUMNARIAS – first rounded machine struck coins with milled edges.– Also called the PILLAR DOLLARS.– It bore one of the most beautiful

coin design ever produced.– Appeared during the reign of King

Phillip the fifth of Spain in 1732.– In 1772, when King Carlos the

third succeeded the throne, he changed the design of Dos Mundos coins with his bust portrait and it became the traditional coin design for the succeeding rulers.

• The pure silver “Dos Mundos”, with the design of two crowned globes between the Pillars of Hercules were widely used during the Spanish period.– Some of the earlier issued were the

Phillip V 4-Reales and the Ferdinand VI 8-Reales.

• After the arrival of the Spaniards in 1521, trade was conducted using irregularly shaped coins hammered in Mexico.

– Varieties of these silver coins, popularly called “hilis kalamay”, bore the seals of Spanish rulers Charles II, Phillip IV, and Phillip V.

• The Philippines was greatly dependent on Mexico for its currency, thus, coin shortage problems often occurred.– The Philippines lack coins of

lower denominations or loose change.

• The Philippines was greatly dependent on Mexico for its currency, thus, coin shortage problems often occurred.– The Philippines lack coins of

lower denominations or loose change.

• BARILLAS - first copper coins to be minted in the Philippines.– The earliest Barilla was minted in

1728 but the first historically documented copper coin was dated 1766.

– It featured a castle with a crown on top and the legend “Ciudad de Manila 1766” on one side. The reverse bore a crowded shield and a monogram.

– The name Barilla became incorporated into the Tagalog word “Barya” meaning loose change or miner coins. It circulated until 1836.

• 1810- The Galleon Trade brought a variety of new coins from Mexico, Peru, Chile, Bolivia and Argentina all colonies of Spain which had either gained or were still fighting for their independence.– The authorities in Manila were

afraid that these coins would influence the Filipinos into fighting for their own independence.

– They tried to stamp out the coins’ origins by counterstamping them.

• 1828-1830- the counterstamp consisted of the word “Manila” in the center and the date below.

• 1832- The counterstamp consisted of a small circular depression within which was a crown of pearls and the initials “F 7” for King Ferdinand the Seventh.– It was later changed into “y 2” for

Queen Isabel the Second who succeeded the throne in 1834.

– The counterstamping stopped when Spain began to recognize her former colonies as independent states.

• 1852- Paper money was introduced during the reign of Queen Isabel the Second.

• PESOS FUERTES- first paper money that circulated the country.– Issued by the newly established El

Banco Español Filipino de Isabel Dos—the country’s first bank.

– Five, ten, twenty five, fifty and one hundred pesos fuertes were issued measuring four by six inches.

– These notes were worded in Spanish and carried the portrait of the Queen. And was issued till 1896.

Pesos Fuertes

• CASA MONEDA de MANILA- the first mint established in 1861, still during the Queen’s reign.– The Manila Mint struck one, two

and four peso gold coins bearing the Queen’s bust of arms on the other.

– For the first time, the country’s name, Filipinas appeared in the coins.

– The coins were called Isabelinas and Alfonsinos.

• 1864- The Manila Mint started producing silver coins in minor denominations of ten, twenty, and fifty centavos de peso.– These coins bore the portrait of

the Queen and later of King Alfonso the 12th.

– These coins were minted until 1898, when production stopped with the Spanish rule.

• 1897- Silver pesos were produced in Madrid.– Six million silver pesos were

minted for exclusive use of the Philippines.

– The coins bore the profile of the young King Alfonso the 13th on one side and the legend “Islas Filipinas” on the other.

– These coins were later known as the Spanish-Philippine peso and served as legal tender until the Americans demonetized them in 1904.

Currency of the First Philippine Republic

• 1896- Revolution broke out with the Katipuneros against the Spaniards.– As a result, the first Philippine

Republic was proclaimed on June 12, 1898.

• The first president, Gen. Emilio Aguinaldo took steps to adopt a national currency system.

• The army arsenal in Malolos struck two types of copper coins in two centavo denominations.– The first type was smaller and

featured the sun in the center, with three stars above an island.

– The second type had a triangle with the sun in the center, and a star within each point in the triangle.

– These coins are very rare and it is possible that they were only coin patterns and were not issued at all, since the first Philippine Republic was short-lived.

• Aguinaldo also ordered the production of paper money. – Only one and five peso bills

were printed.

• The notes were individually hand signed by Pedro Paterno the secretary of Interior of the Republic.

Currency during the American Occupation

• New monetary system was established.

• Based on a gold standard• 1$ = 2 Php• Silver coins: 1 peso, fifty,

twenty, and ten centavo denominations.

• Based metal coins: one-half, one, and five-centavo denominations.

• US Congress approved the Coinage Act for the Philippines in 1903.

Significant Years• 1912 – Banco Espanol Filipino

was renamed to Bank of the Philippine Islands.

• 1916 – Philippine National Bank was established.

• 1918 – one peso bill was added.

• 1919 – silver coins and base metal coins were minted in the United States. Silver certificates were replaced by Philippine Treasury Certificate.

Significant Years• 1937 – PNB’s notes were made

in the United States and by 1948, they were withdrawn from circulation.

• 1941 – the former Manila Mint, now the mint of the Philippine Islands opened and struck the coins.

• 1944 – 1945 – All coins were again minted in the United States.

Currency of the Commonwealth Era

• 1935 – the country was granted the status of a Commonwealth by the United States.

• Three silver coins were issued: two one peso coins (One - conjoined busts of Presidents Roosevelt and Quezon. Other coin - conjoined busts of Governor General Murphy and President Quezon.

• The fifty centavo coin had the busts of Murphy and Quezon facing each other with a sun in the center.

• All these coins had a common reverse: Coat of arms of the Commonwealth, the legend “USA” above and the date 1936 below.

• Regarding the paper money, the new Commonwealth seal was used in all the series issued.

• President Quezon’s signature replaced that of Government General Murphy.

• From “Philippines Islands”, single word “Philippines” was used.

• On October 20, 1944, Gen. MacArthur brought in new Philippine Treasury Certificates. It has the word “Victory”.

• These bills continued to be in use even after 1949, but as redeemable in silver coins.

Currency during the Japanese Occupation

• Currency during Japanese Occupation from 1941 to 1945 was issued in great volumes, with notes ranging with one centavo to one thousand pesos. This was called “Mickey Mouse Money” by the filipino..

• Military forces and loyal civilians issued their own paper money known as Guerilla Currency.– But this were not accepted by

everyone since the Japanese tortured and even killed person who were found using this.

• Silver coins amounting around 14-17 million pesos were dumped into the water of Caballo bay, in order to keep the money from the Japanese.– But only around 12 million of

the total amount sunk has been recovered.

Currency of the Philippine Republic of 1946

• Central Bank was established, bringing a new monetary policy called Managed Currency System.– This policy freed the existing

system from the rigidity of gold and silver standards.

• At this time, Victory Certificates are still in use.– These notes became liabilities of

the bank and were overprinted with the Bank’s name on the reverse.

Victory Certificates

• The Central Bank’s first issue, however, were notes in one, two, five, ten, twenty, fifty, one hundred, two hundred, and five hundred peso bills has been withdrawn from circulation in 1957.

• The rest of the bills were withdrawn in circulation by President Marcos during 1967.

• Central Bank also issued notes in five, ten, twenty and fifty centavo denominations. – These are made to replace the

worn out coins minted during the American Occupation.

• Coins were also issued using designs of the pre-war era, and these had inscriptions in English. These coins are known as the English Series.– They’ve been withdrawn from

circulation on August 31, 1979.

English Series

• Coinage series had radical changes and these coins featured designs resulting from a nationwide contest and depicted historical personages with inscriptions in Filipino. These coins are known as Filipino Series.

Filipino Series

Central Bank started issuing paper currency in Filipino during 1969.

• In 1973, President Marcos decreed the issuance of currency called the Bagong Lipunan Series.– 1969 banknotes has been

overprinted with the legend “Ang Bagong Lipunan”.

• With the Bagong Lipunan Series, radical changes in coin design have produced.– Non rounded coins were minted.– One peso coin was also reduced

in size.

Bagong Lipunan Series Non rounded coins

Bagong Lipunan Series’ One peso coin

• The latest currency produced and issued are the Central Bank Series and New Bangko Sentral Series.

The New Generation of

Philippine Banknotes

Design Highlights• President Manuel L.

QuezonFilipino as the National Language

• Malacañan PalaceSeal of the Republic of the PhilippinesThe New BSP Seal

20 Piso Banknote (Obverse)

1. Embossed printsRaised prints that feel rough to the touch, i.e. the words “REPUBLIKA NG PILIPINAS” and “DALAWAMPUNG PISO”, portrait, signatures, value panels on the face of the note


2. Serial NumberComposed of 1 or 2 prefix letters and 6 or 7 asymmetric (increasing in size) digits located at the lower left and upper right corners of the face of the note


3. Security FibersRed and blue visible fibers embedded on the paper at random and glow in two colors under ultraviolet light


4. Security FibersA shadow image of the portrait and the numeral ‘’20’’ seen at the blank space of the note when viewed against the light from either side of the note


Design Highlights• Banaue Rice Terraces (UNESCO

World Heritage Site) • Animal: Palm Civet (Paradoxurus

hermaphroditus philippinensis)

20 Piso Banknote (Reverse)

5. See-Through MarkThe word ‘’PILIPINO’’ written in Baybayin (pre-Spanish Philippine writing system) is seen in complete form when the note is viewed against the light


6. Concealed ValueThe denominational value superimposed on the smaller version portrait at the upper left side of the note becomes obvious when the note is rotated 45 degrees and tilted down


7. Security ThreadAn embedded thread running vertically across the note is visible from either side of the note when viewed against the light


Design Highlights• President Sergio OsmeñaFirst

National Assembly 1907Leyte Landing

• Seal of the Republic of the PhilippinesThe New BSP Seal


1. Embossed PrintsRaised prints that feel rough to the touch, i.e. the words “REPUBLIKA NG PILIPINAS” and “LIMAMPUNG PISO”, portrait, signatures, value panels on the face of the note






4. WatermarkA shadow image of the portrait and the numeral ‘’50’’ seen at the blank space of the note when viewed against the light from either side of the note


Design Highlights• Taal Lake• Animal: Maliputo (Caranx

ignobilis)


5. See-through MarkThe word ‘’PILIPINO’’ written in Baybayin (pre-Spanish Philippine writing system) is seen in complete form when the note is viewed against the light




7. See-through MarkAn embedded thread running vertically across the note is visible from either side of the note when viewed against the light


Design Highlights• President Manuel A.

RoxasCentral Bank of the Philippines 1949Inauguration of the Third Republic 4 July 1946Seal of the Republic of the PhilippinesThe New BSP Seal


1. Embossed PrintsRaised prints that feel rough to the touch, i.e. the words “REPUBLIKA NG PILIPINAS” and “SANDAANG PISO”, portrait, signatures, value panels on the face of the note








Design Highlights• Mayon Volcano• Animal: Whale Shark

(Rhincodon typus)






7. Security ThreadA stitch-like metallic thread running vertically across the note changes color from red to green. The front of the thread bears the alphanumeric “BSP100” in clear text while the back is imprinted with “BSP”, both in repeated series


Design Highlights• President Diosdado P.

MacapagalEDSA People Power II January 2001Independence HouseBarasoain ChurchSeal of the Republic of the PhilippinesThe New BSP Seal


1. Embossed PrintsRaised prints that feel rough to the touch, i.e. the words “REPUBLIKA NG PILIPINAS” and “DALAWANDAANG PISO”, portrait, signatures, value panels on the face of the note


2. Serial numberComposed of 1 or 2 prefix letters and 6 or 7 asymmetric (increasing in size) digits located at the lower left and upper right corners of the face of the note






Design Highlights• Bohol Chocolate Hills • Animal: Tarsier (Tarsius

syrichta)








Design Highlights• Icons of Democracy: President

Corazon C. Aquino and Senator Benigno S. Aquino, Jr. EDSA People Power I February 1986Benigno S. Aquino, Jr. MonumentSeal of the Republic of the PhilippinesThe New BSP Seal


1. Embossed PrintsRaised prints that feel rough to the touch, i.e. the words “REPUBLIKA NG PILIPINAS” and “LIMANDAANG PISO”, portrait, signatures, value panels on the face of the note








Design Highlights• Puerto Princesa Subterranean

River National Park (UNESCO World Heritage Site)

• Animal: Blue-naped Parrot (Tanygnathus lucionensis)




6. Concealed ValueThe donominational value superimposed on the smaller version portrait at the upper left side of the note becomes obvious when the note is rotated 45 degrees and tilted down




8. Optically Variable DeviceA reflective foil that bears the image of the Blue-naped Parrot and a small BSP Logo. The color of the parrot changes from red to green when the note is rotated at 90 degrees


Design Highlights• War Heroes: Josefa Llanes Escoda,

Jose Abad Santos, and Vicente LimCentennial of Philippine Independence 1998Medal of HonorSeal of the Republic of the PhilippinesThe New BSP Seal


1. Embossed PrintsRaised prints that feel rough to the touch, i.e. the words “REPUBLIKA NG PILIPINAS” and “SANLIBONG PISO”, portrait, signatures, value panels on the face of the note










6. Concealed ValueThe denominational value superimposed on the smaller version portrait at the upper left side of the note, which becomes obvious when the note is rotated 45 degrees and tilted down




8. Optically Variable DeviceA reflective foil that bears the image of the South Sea Pearl inside a clam and a small BSP Logo. The color of the clam changes from red to green when the note is rotated at 90 degrees


9. Optically Variable InkEmbossed “1000” denominational value at the lower right corner of the face of the note changes color from green to blue when viewed at different angles


Documents

Characteristics of Monetary System