Coins of Taka 1, 2 and 5 denominations are ignored by banks, causing inconveniences to general members of the public, while such coins are also not always accepted in market transactions nowadays.
As a result, 80 crore pieces of coins of Tk 5 denomination valued Tk 400 crore have remained stockpiled in Bangladesh Bank's volts, according to central bank officials
A kind of confusion and antipathy has created centring the coins of Tk 1, 2 and 5 denominations following a remark passed recently by Finance Minister AMA Muhith in parliament.
The finance minister told the House that he had no idea about the existence of Tk 5 coins in the market.
Since passage of Bangladesh Coins (Amendment) Bill, 2015, such coins has started losing value, as commercial banks often show reluctance to lift these and general clients do not appreciate those like before. However, coins of Taka 1, 2 and 5 are in circulation in the market and a fishy image of those currencies has created across the country. But these coins are gradually going out of markets.
At present, 80 crore pieces of Tk 5 coins worth Tk 400 crore are in all BB vaults countrywide. Nearly the same amount of money in the form of Tk 5 paper notes are in circulation in the market.
Besides, nearly 85 crore 71 lakh 64 thousand pieces of coins of Tk 1 and 2 denominations are also stored in the BB vaults. Although there is scarcity of coins of Tk 1 and 2 two denominations in the markets, sacks of such coins now lie in the head offices of different commercial banks besides BB vaults.
Suvankar Shaha, Bangladesh Bank's Executive Director, told the Daily Observer: "Banks are reluctant to accept coins following such confusions. We've issued circulars making mandatory the acceptance of such coins. Even there is a provision of penalising banks or individuals who would refuse to accept such coins."
All scheduled banks are under compulsion to take delivery of Tk 1 and 2 notes and coins at 1 per cent.
"For space constraints in the vault, we feel uncomfortable," a BB official said. However, to cope with the situation, BB's Chittagong office has raised its vault capacity. Such a move is under process in Rangpur and Barisal offices of the central bank.
The Tk 1 note is going to lose its value. But to transact and tally accounts, such note or coin is in demand. At the moment, nothing other than a match box, a piece of needle or a chocolate can be exchanged for Tk 1 in the market. By now 1 Paisa, 10 Paisa, 25 Paisa and 50 Paisa have lost their necessity in the market. At the moment, Tk 1 notes or coins are needed to tally income expenditure account, make payments for kitchen market shopping, grocery shops, bus fare and rickshaw fares. Because of the coin crisis, shop keepers have opted for giving out a piece of chocolate instead of giving Tk 1 note or coin.
A senior official of Bangladesh Bank said, "As a matter of symbol, chocolates are being exchanged for Tk 1 or 2 note or coin, as alternatives. We are bringing in coins to stop these. The value of Tk 1 or 2 has not yet lost in Bangladesh, since in many government and private organisations need these currencies when they make accounts of small changes. This is why BB has continued to supply small notes. All banks of the country are bound to accept or give currencies."
Helaluddin, FBCCI's former vice president, said, "Small businessmen use Tk 1 note or coin more, but that is not usually available. Bank branches do not supply those. That is why they give chocolate instead of Tk 1. Tk 1 has lost its value in the market, so the use of Tk 1 currency should be stopped."
Helaluddin wondered why banks are reluctant to accept coins of Tk 5 denominations.