Why are countries slow to switch to polymer banknotes? (Topic)

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Why are countries slow to switch to polymer banknotes?


At first glance, money made from polymeric materials has many advantages over paper money: it deteriorates more slowly, does not absorb moisture and does not get dirty so quickly, which is very important for countries with a hot tropical climate.

Despite the fact that the production of polymer money is an expensive procedure, the costs are paid off due to their long service life. Plus, they'll be harder to counterfeit than paper ones.

The advantages of polymer money are impressive, but why then are countries in no hurry to establish their mass production?

At the moment, only 8 countries have in circulation exclusively banknotes made of plastic: Australia, Canada, Maldives, Brunei, Papua New Guinea, New Zealand, Romania and Vietnam. A number of other countries (including the United Kingdom and the United States) make only part of the national currency from polymer.

Attempts to make the first polymer money took place in Haiti and Costa Rica in the 80s, however, due to problems with ink application, production was quickly curtailed. Since then, new attempts have been made on the Isle of Man, but have also been unsuccessful.

Australia began the transition to polymer money in the late 80s, when the country was already well established with plastic printing. At that time, the Central Bank had the opportunity to protect the new type of currency from counterfeiting by applying high-tech printing signs and creating transparent parts on the banknote.

The US and Canada soon adopted the Australian experience to combat counterfeiting. Canadians claim their $ 100 banknote is the most secure in the world thanks to a transparent opening containing a hologram that is visible in the light.

However, Tom Hockenhall, curator of the Modern Money exhibition at the British Museum, says the security gap between paper and polymer money is closing. According to him, counterfeiters have made significant progress and from time to time produce high-precision counterfeits for polymer banknotes.

He also notes some of the disadvantages of plastic money: they are harder to bend and more slippery. For these reasons, they are inconvenient to store in a small wallet and difficult to read by hand.

There are other disadvantages as well. Since the cost of polymer money is high, most of the second and third world countries simply cannot find the funds to produce them. In addition, in the future there will be problems with the disposal of polypropylene: it is recyclable, but due to the same lack of funds, a number of countries will not be able to afford the purchase of the necessary equipment, and the burning of plastic will entail the release of toxic substances into the atmosphere.

For these reasons, many central banks are quite conservative and wait for their foreign counterparts to gain more experience in the transition from paper to polypropylene.

The Topic of Article: Why are countries slow to switch to polymer banknotes?.
Author: Jake Pinkman