The governor of the Central Bank of Egypt announced that the CBE will issue LE 10 and LE 20 polymer notes by the beginning of 2021. This move comes as the CBE moves its headquarters to the new administrative capital. The Central Bank said it is allocating four lines in its new printing house for the production of money made from synthetic polymer. The transition from paper notes to plastic notes requires extremely high upfront production costs. So, why did the CBE decide to transition to plastic notes?
Why Will the CBE transition to plastic notes?
Clean: A preliminary bacterial study of Egyptian paper money revealed that over 65% of bills had a bacterial count above 5.0 cm2. Plastic currency, on the other hand, is more resistant to dirt and moisture.
Reusable: At the end of the lifecycle of paper money, it is usually torn and transported to the landfill. Polymer, on the other hand, is extracted from the circulation, chopped into granules and used to manufacture plastic goods, such as garden furniture.
Durable: Polymer reportedly lasts over 2.5 times as long as paper notes. This reduces its replacement cost of the bank notes.
Secure: Unlike paper currency, plastic currency allows the addition of extra security layers. During the manufacturing process highly sophisticated technologies are incorporated. As a result, the move to plastic currency is expected to reduce counterfeiting.
Waterproof: According to The Guardian, plastic currency is completely waterproof.
Energy Efficient: Polymer is produced with less energy. However, it is worth noting that polymer banknotes take longer to biodegrade.
The environmental impact of the lifecycle of banknotes worth €3 billion produced in 2003 is equivalent to the environmental impact of driving a car around the world in 9,235 times, according to a study conducted by the Bank of Canada in 2016.Source: State Information Service
Does that mean that old paper Notes become worthless?
No, it does not. According to Egypt’s State Information Service, the issuance of the new LE 10 and LE 20 denominations does not mean that its old counterpart will be canceled. The paper notes will still have the power of discharge even in the presence of the new category, and citizens have the right to use them.
Egypt is not the first country to adopt polymer currency. Countries such as China, Australia, Romania and the UK among others have already issued their currency in plastic banknotes.