Apart from new banknotes of Rs 5,000 and Rs 20, the Federal government has decided to introduce new series of banknotes of other denominations one after the other to replace existing banknotes, reliable sources in the Finance Ministry told Business Recorder here on Friday. Sources said the Federal Cabinet, in its last meeting, had approved the proposal, submitted by the Finance Ministry in consultation with State Bank of Pakistan (SBP) to replace old banknotes with new ones.
The existing banknotes, the sources said, would remain in circulation side by side with the new currency notes as the old design would be gradually withdrawn in a systematic fashion over a period of three to five years after the SBP was satisfied that the new notes in circulation had reached a comfortable level.
Giving background of the decision, the sources said that the existing notes were introduced many years ago and since then there had not been any significant change in their design.
The rapid technological advancements in digital imaging and printing had helped counterfeiters to easily forge the banknotes, which lacked advance security features, said the sources.
Keeping in view the threat of forgery, the sources said, the SBP and Pakistan Security Printing Corporation (PSPC) conducted a comprehensive exercise for replacement of the existing banknotes.
"New banknotes would have state of the art security features, which are difficult to be forged and are also likely to facilitate efficient note processing through modern electronic devices," they said.
Asked why the government decided to issue banknotes of Rs 5,000 and Rs 20, the sources said that these notes were proposed to be introduced with a view to offering a broader range of denominations to the public and reduce pressure on the existing currency.
The following are main benefits of introducing higher denomination banknotes:
-- The economy in expenditure on printing of banknotes as higher domination notes would reduce consumption of lower denomination notes.
-- Provide relatively safe and cost effective medium of funds transportation from one place to another.
-- Savings in labour and expenditure to banks and general public in dealing with cash transactions.
The new series of banknotes, the sources further said, would have portrait of Quaid-e-Azam Muhammad Ali Jinnah in national dress (Sherwani) on the front side.
The following are other salient features of the proposed banknote series:
-- The colour tone of new banknotes has been kept lighter to provide aesthetically pleasing softer look.
-- The new banknotes have many new technologically advance security features such as (i) optical variable ink (ii) fluorescent and magnetic ink numbering (iii) coloured visible and invisible fibre (iv) offset antiscan/ anticopy background with line thickness and colour graduation, besides other overt features that would assist the general public to easily identify a counterfeit.
-- Considering the low literacy rate in the country, it was deemed preferable to keep the length of the banknotes different for each denomination.
However, the overall size of the new notes has been kept smaller than the existing ones. This would facilitate the physical handling of the new notes in wallets causing less damage to note besides reducing their manufacturing cost.
-- The architectural heritage of the country was given due consideration while identifying the vignettes to be printed on the backside of the banknotes.
After extensively reviewing several proposals, picturesque vignettes of famous monumental structure located in the four provinces and the Federal capital are proposed to be printed on the backside of the new banknotes.
The sources further said that Prime Minister Shaukat Aziz appreciated the efforts of the SBP and the PSPC for significant changes in the proposed design of banknotes with technology advance security features.