End of the road for old Philippine Peso banknotes
30 December 2016 was the last day that the old Philippine peso banknotes were exchangeable at the Bangko Sentral ng Pilipinas in Manilla. From today, the old peso banknotes no longer have a monetary value. At Leftover Currency however, we will continue to exchange old Philippine peso banknotes.
No more face value. But not worthless.
After banknotes are passed the final exchange deadline, they become ‘demonetized’: they are no longer considered money. The old peso banknotes from the Philippines are a recent example. The same is likely to happen soon with the 500 and 1000 Indian rupee banknotes.
But ‘demonetized’ does not mean that cancelled banknotes become totally worthless. There is a collectable and emotional value that remains.
The collectable value of a banknote is determined by factors like scarcity and collector demand. The emotional value is often linked to the old value of the banknotes. An old 1000 peso banknote, for example, used to buy a good 3-course meal for two people in a mid-range restaurant in the Philippines. Having been a status symbol, every high denomination banknote will retain some emotional value after demonetization.
We continue to exchange the demonetized old Philippine peso banknotes at a value that covers their collectable and emotional value.