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- "The Bank of Russia sees no grounds for starting a discussion on the abolition of cash"
"The Bank of Russia sees no grounds for starting a discussion on the abolition of cash"
The corrected modernized thousand-dollar banknote is likely to be put into circulation closer to the end of next year, Central Bank Deputy Chairman Sergei Belov said in an interview with Izvestia. He also spoke about how many objects can get on the banknote after the vote, how the regulator treats the fact that again there may be dissatisfied citizens, and whether the principle of refusing to use iconic images on money will be preserved when modernizing banknotes of 500, 50 and 10 rubles. Whether the discussion on the abolition of cash, whether there is relevance in the 10-thousand bill and much more - in an exclusive interview with Izvestia.
"The symbol on the banknote should resonate with all Russian citizens"
- Sergey Vladimirovich, why did the Central Bank decide not to correct the controversial design on the back of the new 1,000th banknote, but to change it completely?
- Yes, at first glance it seems that it would have been easier: just remove the symbols that caused an ambiguous reaction in society and replace them with other ones. But banknote design is a truly jewelry and very painstaking work. There are quite serious restrictions on the design due to the peculiarities of the security seal. You cannot simply replace one cultural and historical object with another, so as not to break the harmony of the composition and not to change the layout of the security features. That is why we took a step back and decided to work out the design of the reverse side of the banknote anew.
- So the reason is rather technical?
- No, the main reason is that we changed the approach to the banknote design and made the procedure of symbol selection more open. Now, in addition to regional groups, we have created an advisory council, which includes historians, architects, designers, cultural figures. The experts proposed a list of sights of the Volga Federal District (VFD) that are of the greatest value for the whole country. Then we decided to get people's opinion and put this list to a popular vote. The technical side I was talking about is rather secondary.
- By the way, why did you decide to resort to the popular vote, although in 2021 you gave up this method?
- Banknotes are the country's calling card. The banknote should be attractive, it should have objects known to all residents of the country, not just certain regions. That is why we decided to return to online voting as a key stage.
Exactly to return, as this is not a new method for us. This format was first used in 2016, when we were preparing to issue banknotes of new denominations - 200 and 2000 rubles. At that time, we really approached the choice of the symbol as openly as possible - through a contest with online voting in the finals. But the last word remains with the Board of Directors of the Bank of Russia.
The Central Bank decided to resort to popular vote on the choice of objects for the back side of the thousand-dollar bill a year after it first issued (October 16, 2023) it into circulation, and two days later recalled it.
On the reverse side of the banknote was the palace church in the Kazan Kremlin built in the XVII century, which now houses the Museum of the History of Statehood of the Tatar People and the Republic of Tatarstan. The building has been used for secular purposes since the beginning of Soviet times, at which time the cross was removed from the former church. In the design of the thousand-dollar bill, the building is the same - without the cross. At the same time, the Syuyumbike tower with a crescent moon is depicted nearby, which caused a flurry of criticism in the direction of the Central Bank.
This year, the Central Bank decided to completely change the design, rather than correct the old one, to abandon religious buildings as images on the banknote, and also announced a nationwide vote.
- Why is the vote all-Russian, and not, say, within the Volga District, so that its residents could decide which objects should represent their region?
- Every region has many historical monuments, unique places that local residents are proud of. But the symbol on a banknote should resonate with all Russian citizens, regardless of where in the country they live, because banknotes are part of our cultural code, as Elvira Sakhipzadovna (Nabiullina, head of the Central Bank - Izvestia) said.
- This time the Central Bank has also decided to refuse to use religious buildings. Will this principle apply to other banknotes that will be modernized - denominations of 500, 50 and 10 rubles?
- Indeed, we can see religious objects on the banknotes of the 1997 sample. But when we changed the concept of banknote design and switched from the city series to the regional series - now each banknote is dedicated to one of the federal districts - we simultaneously decided to abandon the depiction of religious objects.
We will retain this principle for other banknotes that we will modernize. After all, Russia is a multi-ethnic, multi-confessional country. It is populated by people with different unique traditions, people who profess different religions.
"The fact that Meteor is in the lead does not mean that only it will appear on the banknote"
- I'm following your vote, and I suspect that again there may be dissatisfied people. Now the winged motor ship "Meteor", which is the symbol of Nizhny Novgorod, is leading by a significant margin. If both the front and the back sides are covered with objects of the capital of the Volga Federal District, there is no risk that other residents of the region will express their dissatisfaction?
- Such a risk is inevitable. That's why we are holding a vote, so that the choice is common and takes into account different opinions. But I would like to clarify that we are not choosing one main object, but a wide range of symbols. If you pay attention, on our banknotes the images are presented in the form of a kind of collage. As a rule, there are three groups of images on the banknote. Objects of the first plan set the theme, they should be well recognizable and without a lot of small details. Symbols of the second plan support the main theme, complement it, create a general background. And there are also micro-patterns, drawings that sometimes cannot be seen without a magnifying glass, but they also further reveal the main theme.
The image of the high-speed passenger ship "Meteor", which may appear on the reverse side of the new thousand-dollar banknote
The fact that "Meteor" is the leader does not mean that only it will appear on the banknote, other leaders of voting can be used. Much will depend on the artists who will create the design, it is not an easy job. All the selected symbols should be combined with each other. Therefore, it is difficult to say how many objects - leaders of voting and which ones will be included in the main composition.
- But still more chances to be on the banknote at the symbols that will be on the top lines in the voting?
- Yes. There are more chances. We do not determine for ourselves how many objects will appear on the banknote. I repeat that when developing the design, the artists will take into account the combination of objects, how they can be placed on the limited space of the banknote, taking into account the elements of the security complex. Now it is difficult to say what the updated design will look like. Let's trust the professionals, I'm sure they will succeed. But let me remind you that the final design will be approved by the Board of Directors of the Bank of Russia.
Top 3 leaders of the Central Bank's voting as of December 8:
1. high-speed passenger hydrofoil motor ship Meteor;
2. monument to Salavat Yulaev in Ufa;
3. the Saratov automobile bridge over the Volga River.
- You said that you are focused on the banknote issue in the second half of next year. Can you be more precise?
- We are really aiming for the second half of the year. It is difficult to be more precise, because there are several stages of banknote development: first we prepare a conceptual design, then a sketch project, then we prepare for production, make the printing project and only then print the circulation. In general, there is a big and long work to be done, usually it takes about a year. It is very difficult to give a specific date now, but it will probably happen towards the end of the year.
- Did the process of modernization of the thousand-dollar bill become more expensive because of the fact that the reverse side had to be redesigned?
- We traditionally do not disclose the costs of banknote production. There has certainly been a certain increase in price, but everything is within the planned costs.
- Did you vote yourself? If yes, which object? If not, do you have a favorite?
- I voted on the first day. In fact, each proposed symbol is worthy to be on the banknote, but for now I will not say which object I have chosen, I will keep the intrigue so as not to influence the voting process. After the results are announced, I will be ready to announce it.
- Do you know if Elvira Sakhipzadovna has voted? After all, the voting involves a symbol from her hometown.
- I am sure that she voted, but I do not know for which object. In general, almost 300 thousand people have already participated in the popular vote. And those who have not yet done so, can have time to become one of the designers of the new banknote. Voting will last until December 12, until 12 o'clock Moscow time.
- At the presentation of the shortlist for voting, it was mentioned about the difficulty of using the copyright on the objects. Is there really any problem with this?
- All objects that are depicted on both banknotes and coins undergo a thorough legal examination. If they are works of architecture, sculpture, decorative and applied art and so on, they are subject to exclusive rights. Therefore, before depicting any object on monetary signs, we must obtain the consent of the owner of these rights. We are constantly working with this. Usually all right holders are happy to respond to our request and give their permissions. But, of course, sometimes it's just hard to find them. If suddenly for some reason we are unable to settle copyright issues for a certain object, we will have to give it up.
- Has the Central Bank thought of including the five-ruble bill, which it started printing again a couple of years ago, in its modernization plan?
- In 2022, we resumed printing five-ruble bills, which we had not issued for several years. We can say that they are now almost as good as new - many people have already forgotten what they looked like. And five-ruble notes are now actively used, they are convenient to handle and process, as they are much lighter than coins. At the moment we are not planning to modernize this denomination. But maybe we will return to this issue. For now, definitely not.
"The storage of our banknotes is definitely fine".
- Recently, I was surprised to learn that it is very risky to keep dollars at home, as they are prone to fungus infection, after which when checking machines determine them as invalid. Are there such problems with ruble banknotes?
- We are constantly improving the quality of our banknotes to extend their life. They are quite high-tech and well stored, as they are covered with a special varnish. In any case, there are no problems with the exchange of damaged domestic banknotes: you can always go to the bank and change them. Therefore, there are no risks either for citizens or for business.
- So you can safely keep them at home?
- Our banknotes are definitely stored normally. And with various damages, I repeat, they can be exchanged. But, as they say, it is better to keep money in banks.
- It is understandable, but many citizens, even despite high rates on deposits, prefer to keep part of their savings at home in cash. Wouldn't it be easier for them to do so in larger denominations? For example, recently there was again an absentee dispute in the State Duma about the relevance of issuing a 10-thousand-dollar note. Does the Central Bank still believe that this should not be done?
- As of today, there are no such plans. The decision to issue new denominations is always made on the basis of the current economic situation in the country, the needs of cash money circulation, the ratio between the volume of cash and non-cash payments. We observe a significant growth of non-cash payments, so we are sure that the nominal range of banknotes and coins is optimal for today.
- In what time perspective does it not make sense to return to the talk about the issue of the 10,000-ruble bill?
- We will keep an eye on the situation, but for now the issue of 10,000 is irrelevant.
- This year, the deputy head of Goznak surprised everyone with the statement that by 2030 there will be a discussion about the fundamental need for the existence of cash. Does the Central Bank support this opinion?
- I think the words were taken out of context, it was not about the abolition of cash. There are more than 18 trillion rubles in circulation today, which indicates the demand for banknotes and coins. Some people still prefer cash, and this is absolutely normal. Our task is to provide people with the opportunity to choose.
- In the near future, should we not expect the discussion on the abolition of cash in the near future?
- The Bank of Russia sees no grounds for this. If you look at the share of cash in settlements, yes, it is decreasing, but not in circulation. The volume of cash remains unchanged. Two thirds of this money is in the hands of the population. The rest - in the cash desks of trading and service companies, banks, in ATMs.
"There are no prerequisites for denomination at the moment"
- Will this be reflected in the new Strategy on cash circulation, which you are to adopt in 2025 for the next five-year period?
- We have just started working out the main directions of cash circulation development (CDD) for the next five years, until 2030. We have a whole year for this. Of course, the new strategic document will retain the continuity of the main provisions. Cash, as I have already said, continues to be present in people's lives. Therefore, the issues of maintaining and developing the NDO system, its optimization and efficiency increase do not lose their relevance. I can already announce that we will include new tasks in the document, for example, we plan to pay special attention to the development of internal collection.
Also, one of the challenges for us remains the transition to the use of Russian-made equipment and domestic technological solutions. The issue of cash storage will also remain.
- Are you referring to the development of the practice of storing cash in banks, which began to be used in the pandemic at the time of a sharp increase in demand for paper money?
- Yes, absolutely. We use commercial banks to hold the cash we own. This approach benefits both us and the commercial banks. The costs of transportation and processing of banknotes are reduced, and liquidity is increased. The number of participants is growing dynamically and has already far exceeded our expectations. We plan to involve new players in this work in the future.
- What changes do you plan for the collection market?
- Back in August we published a report for public discussion. It considers different scenarios for regulating the collection market in order to preserve the availability of cash throughout the country. In particular, for example, it is possible to establish unified rules for cash carriers. Now we are summarizing the results of the discussion, and in February we plan to announce our final proposals.
- By the way, after increasing the limit of transfers without commission between their accounts up to 30 million rubles, cash collectors said that the demand for their services has fallen, as it is necessary to refill ATMs less often. Many people withdrew money from their bank to deposit it in another bank to repay loans.
- We have heard about it too, credit organizations are talking about it. This is precisely the reason to reorganize internal work and processes, and to find new points of efficiency. By the way, this is also reflected in our report. This is a new challenge that we are facing.
- One of the NDO experts told me that we should charge a fee to banks that hand over change to the Central Bank, because it means that they do not know how to handle it.
- The Bank of Russia accepts change from banks for free, it was and is. But the problem is different. Change coins are needed not so much by banks as by their clients - the same stores. And here it is important to involve into circulation the change that settles in people's pockets. For this purpose, we hold an annual "Coin Week", when you can give money from your piggy bank on favorable terms. By the way, chain stores joined our campaign this fall.
- Maybe it would be easier to return value to the kopeck through denomination, the question of which is now being raised again in the expert community in connection with high accumulated inflation? Does the Central Bank have any plans for this?
- You ask me every year, and I answer every time that there are no prerequisites for denomination at the moment.
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