January 2009

2,000-guarani Banknotes will be Made of Polymer

Tuesday, 20 January 2009

Notes for 1,000-guarani remain valid.

A new consignment of 5,000-guarani banknotes will arrive in April.
The Treasurer of the Central Bank of Paraguay (BCP), José Meza, indicated to Radio Caritas this morning that 1,000-guarani banknotes remain in circulation and should be accepted; they are lawful currency and legal tender. He explained that the Central Bank cannot obligate people to accept excessively deteriorated banknotes; he recommended and requested that people go to the office of the monetary institution or the bank where they do business and exchange these bills for coins. He emphasized that the BCP has an adequate supply of 1,000-guarani coins to be able to exchange the damaged money, which when received by the institution is destroyed. “Our offices are especially set up for those people that do not work with a specific financial institution that do not have a current account or savings bank; for the shopkeeper, the small retailer that has no bank account. Offices are set up where they can change their damaged 1,000-guarani notes for coins.” We would like to make it clear that the banknote is still lawful currency, legal tender.”

POLYMER BANKNOTES

With respect to the coming issue of 2,000-guarani polymer banknotes, Mr. Meza pointed out that this is in response to the need to make progress and to innovate with technology. He explained that it is desirable to implement this new technology because of its greater durability, and that the 2,000-guarani denomination was chosen due to the big gap between the 1,000-guarani coin and the 5,000-guarani note. People are very accustomed to using banknotes, and based on studies that were done, it is seen as advantageous to introduce a 2,000-guarani note. The second step was to decide the type of material for the bill given that it will have high circulation, and that now 1,000-guarani notes will not be made because coins are taking their place. “Because of that we believe it advisable to make them with substrate of polymer, which is plastic, a material used in Brazil for 10-real commemorative notes. In this region they are currently used in Chile, Mexico, Guatemala, Nicaragua, and Honduras, independent of their use in some Asian countries” The Treasurer of the Central Bank emphasised that these bills have outstanding characteristics, durability, and are healthier because dirt does not stick to the plastic. He said that initially there will be 2,000-guarani notes, and later, if analysis done regarding public acceptance indicates it is merited, then other denominations will be changed; with prior authorization of the Directorate they would be replaced. José Meza insisted that the change of the substrate was fundamentally due to the fact that demand must be met, demand, for a 1,000-guarani coin as well as for closing the gap between these coins and the 5,000-guarani note.

NEW 5,000-GUARANI NOTES ARRIVE IN APRIL

Responding to the question regarding the poor condition of the 5,000-guarani notes in circulation, the manager in charge of Central Bank securities explained that as a consequence of the release into circulation of the 1,000-guarani coin and the fact that the notes of that domination that are circulating are in poor condition, the 5,000-guarani note is the most circulated. This resulted in excessive use which caused the stock to run out. But he also said that a new consignment will be arriving in April.


Martin Schocher
PUBLIC COMMUNICATIONS CENTRE
Central Bank of Paraguay
Tel. 610088
Asunción, January 2009

http://www.bcp.gov.py/index.php?option=com_content&task=view&id=478&Itemid=1