Banknote Production
Process
Prepared by: Gladys C. Dolendo,
LPT, MBA
The Philippine Cash Cycle
Production of Currency
Philippine coins and banknotes
are mostly produced in the BSP
Security Plant Complex (SPC). Over
the past four decades, the SPC has
become a world-class producer of
quality coins and notes. It has
overseen the design, production
and issuance of four generations of
legal tender Philippine currency.
The Philippine Cash Cycle
Issuance, Distribution and Retirement
The Philippine cash cycle involves
issuance of new coins and notes,
distribution to the regions of the country,
and retirement of unfit currency. The BSP
adopts a Clean Note and Coin Policy
for the effective removal of unfit
currency in circulation as a means to
maintain the integrity of Philippine
banknotes and coin
The Philippine Cash Cycle
Currency in Circulation
The annual volume/value of
currency issued is based on
currency demand that is
estimated from a set of economic
indicators which generally
measure the country’s economic
activity. The total amount of
banknotes and coins that the BSP
may issue should not exceed the
total assets of the BSP
Banknote Production Process
Thorough planning and deliberation starts the
process of making money available to the
public.
First, the Bangko Sentral's Department of
Economic Research determines currency
demand based on the expected price
movement as well as the growth of population
and the economy.
Banknote Production Process
Second, the Cash Department places the
order with the Security Plant Complex which
in turn procures the materials needed to
produce and print the banknotes. When the
designs of banknotes are changed, final
approval by the President of the Republic is
required.
Banknote Production Process
From the approved design, a
prototype banknote is prepared. The
banknote image is then etched on a
master dye from which printing plates
are produced. Meanwhile, ink experts
mix the exact colors of the money.
Banknote Production Process
With the ink and plates ready, printing
begins on special security paper that is
composed of 80% cotton and 20%
Philippine abaca. This combination gives it
a distinctive texture that sets it apart from
ordinary paper
Banknote Production Process
The sheets of banknote paper go through
offset printing where 15 to 20 colors of the
design are printed at a time.
Next, the paper goes through the intaglio
printing process which gives the money its
embossed look and feel. Raised ink from
intaglio printing requires drying for several
days.
Banknote Production Process
After this, the banknote sheets are
submitted for a series of inspections.
The serial numbers are then printed
on each banknote which are again
subjected to thorough inspection. The
sheets are then cut and packed into
bundles of 1,000 pieces each.
Banknote Production Process
These are now delivered by the
Security Plant to the Currency
Management Group from where
banks exchange or withdraw their
currency requirements. From the
banks, the banknotes finally find their
way to the economy and our wallets.