To maintain the integrity of Philippine currency, the Bangko Sentral ng Pilipinas (BSP) retired 519.93 metric tons of unfit, demonetized, mutilated, and counterfeit (UDMC) coins through defacement. The defacement process was undertaken beginning October 2021 until September 2022.
Coin defacement, done via machine, involves a process that alters the surfaces of coins to prevent them from being recirculated. The defaced coins may then be recycled into different items based on their metallic content.
Of the total UDMC coins defaced, 70 percent or 364 metric tons were unfit coins, 25 percent or 128 metric tons were mutilated, 4 percent or 21 metric tons were counterfeit, and 1 percent or 7 metric tons were demonetized.
Under Republic Act (R.A.) No. 7653, as amended by R.A. No. 11211, the BSP shall retire or destroy all Philippine banknotes and coins found to be unfit, mutilated, or demonetized, including seized counterfeits. This will ensure that only fit and legal tender banknotes and coins are circulated and used to purchase goods and services.
To reinforce its continuing efforts to maintain and protect the integrity of Philippine currency, the BSP is also seeking the enactment of a law defining and penalizing the excessive and unnecessary hoarding of coins.