Meanwhile, the total value of cash stood at 8.9 per cent of gross domestic product in 2023 versus 9.1 per cent in 2022.
Bank Negara Malaysia (BNM) said in its Annual Report 2023 that the central bank focused its efforts last year on ensuring more sustainable use of currency in circulation while preserving the quality and integrity of ringgit banknotes and coins.
"In September 2023, BNM issued a policy document on the quality and integrity of currency to enhance the standards that financial institutions, money services businesses and registered currency processors must adhere to while processing and handling notes and coins.
"These include requirements to ensure that currency in circulation is kept clean and fit for use, as well as procedures to follow when counterfeit currency is suspected," it said.
In 2023, BNM observed a marginal increase in Malaysia's counterfeit index to 1.6 parts per million (ppm), compared to 0.3 ppm in 2022, mainly due to a single incident involving 3,868 pieces of counterfeit currency notes.
"Despite the increase, our counterfeit index remains lower than benchmarked countries," it said.
It said counterfeit notes discovered in Malaysia were mostly poor reproductions of genuine currency, which could be easily recognised using the feel, look, tilt and check method.
To raise awareness, BNM said it carried out a total of 53 currency education programmes nationwide in 2023 involving small traders, retailers, and financial institutions.
Moreover, the central bank said its new mint was launched on Oct 19, 2023, and the previous Kilang Wang BNM had also been officially renamed Malaysia Mint (MyMint), with the name reflecting the position of this facility as the country's only national mint which was first operational in 1971.
"The commencement of MyMint operation in 2023 marked another milestone in BNM's efforts to modernise currency operations in Malaysia, following the successful operationalisation of the Automated Cash Centre in 2016," it said.
Moving forward, the central bank said it will continue to ensure the quality, integrity and availability of notes and coins as they remain a relevant medium of exchange in Malaysia.
"In 2024, BNM will focus on strengthening our collaboration with industry players to improve the overall value chain of the currency ecosystem," it said.
BNM added that this includes optimising its currency operations nationwide and promoting the recirculation of cash among financial institutions, in line with the move towards sustainable practices.
-- BERNAMA
