Bank Negara Malaysia (‘
BNM’) issued an
Exposure Draft of a Policy Document on Quality and Integrity of Currency on 22 February 2023 (‘
Exposure Draft’).
The Exposure Draft outlines the standards to be observed by financial institutions to preserve the quality and integrity of Malaysian currency notes and currency coins in accordance with the Currency Act 2020. The Exposure Draft also covers several related key areas such as currency processing operations and currency processing machines.
The Exposure Draft sets out the following:
- criteria in determining the quality of currency in circulation;
- standards in processing and recirculating currency to the public;
- standards in handling suspected counterfeit Malaysian currency in Malaysia;
- requirements to record and report suspected counterfeit Malaysian currency;
- timeline to lodge a report with Royal Malaysian Police of suspected counterfeit Malaysian currency; and
- requirements to have competent staff and possess and maintain suitable currency processing machines.
The Policy Document when issued will apply to:
- licensed banks under the Financial Services Act 2013;
- licensed Islamic banks under the Islamic Financial Services Act 2013;
- prescribed institutions under the Development Financial Institutions Act 2002;
- licensees under the Money Services Business Act 2011; and
- registered currency processors under the Currency Act 2020.
The Policy Document when issued will supersede the following documents issued by BNM:
- Guidelines on Quality Standards for Malaysian Currency issued on 1 September 2006;
- Guidelines on Handling of Suspected Counterfeit Malaysian Currency Notes issued on 2 September 2014; and
- Guidelines on the Treatment of Unfit, Mutilated, Defaced and Fraudulently Tampered Genuine Banknotes by Commercial Banks issued on 15 September 2009.
Written feedback on the Exposure Draft may be submitted to BNM by
30 April 2023.
Alert by Lee Ai Hsian (Partner) of the Banking and Finance Practice of Skrine.