Last update: 15:32 | 10/01/2018
The State Bank of Viet Nam (SBV) has announced it will not be printing small currency notes for Tet (the Lunar New Year) this time too, the sixth straight year it has desisted from doing so.
The State Bank of Viet Nam has said it will not issue low-denomination banknotes for Tet.
Speaking to the media on Monday, central bank officials said the decision not to issue new notes in denominations such as VND5,000 (22 US cent) and less is meant to cut costs and prevent the use of currency notes for any purpose other than payment.
Traditionally during Tet people give away new small banknotes to pagodas and temples to wish for luck.
Since the SBV stopped printing new notes for Tet in 2013 it has saved VND2.2 trillion, including VND280 billion this year alone, Pham Bao Lam, director general of the central bank’s issue and vault department, said.
The bank has urged relevant agencies and organisations to closely monitor note exchange services and impose fines in case of wrongdoing.
Illegal exchanges will be fined VND20-40 million under Decision 96 of the Government.
When asked about the use of small bills at BOT toll stations recently Lam said the SBV only issues cash for “reasonable demand.”
“For example, if the BOT toll fee is VND25,000, the appropriate payment mode is a VND20,000 note and a VND5,000 note, or two VND10,000 notes and a VND5,000 note, and not 250 VND100 notes.”
Dao Minh Tu, deputy governor of the SBV, said since it is a “negative payment activity” the central bank “will not support it or the drivers or the BOT tolls.”
He said the SBV prints enough bills of all denominations based on demand but not for purposes like paying toll fee or charity offerings at pagodas.
Lam said between April and November last year the SBV has ensured there are enough small-denomination bills to fully meet demand.
The central bank would increase the supply of VND10,000 notes by 20 per cent compared to last Tet, he added.
Since the beginning of last month the SBV has been supplying cash to its offices in cities and provinces that have many industrial parks.
It has instructed the offices and banks to ensure ATMs are supplied with enough cash during the holidays.
Pham Tien Dung, head of the SBV’s payment department, said the central bank has instructed credit institutions to resort to cashless payments in case ATMs are “overloaded.”
Any bank allowing an ATM to remain out of order or money for 24 hours would be penalised, he warned. — VNS