Exchanging worn-out banknotes in small denominations at private and state-owned banks is posing a serious challenge to business people and the public because banks are paying less for old bills.
The Chamber of Industries and Mines (ACIM) says that private and state-owned banks exchange six to eight afghani less per 100 Afs in old bills, which harms all traders and artisans.
“The sales of the country’s industrialists are in Afghan currency, and there is a big difference in the exchange of currency between six to eight afghani, which results in losses to the country’s industrialists,” said Sakhi Ahmad Payman, head of the Chamber of Industries and Mines.
Meanwhile, money changers say that the number of worn-out banknotes has increased recently, and they have difficulty exchanging them in banks.
“Worn-out money has increased, this money does not work in the market at all,” said Mohammad Rahim, a money changer.
“The money changers take old banknotes to the banks and the banks pay 600-700 afghanis for one thousand, which makes a difference of three hundred to four hundred,” said Hamid, a money changer.
Most bakeries trade with small, worn-out banknotes.
One of the bakers in Kabul says that he collects up to 30,000 afghanis in small banknotes from his customers daily and has difficulty exchanging it.
“Ten afghanis and twenty afghanis that are old will not be taken by anyone, and this is to our detriment,” said Ezatullah, a baker.
Economists said that the rejection of small banknotes by public and private banks will cause problems for the trading process in the country.
“They are obliged to accept worn-out banknotes and submit them to the Central Bank, and not to allow anyone, in accordance with the law, to issue worn-out banknotes,” said Mir Shakib, an expert on finance and banking.
The Central Bank did not comment on this issue.
After the political change in Afghanistan, the process of burning old banknotes was undertaken by the Central Bank, and the latest amount destroyed was 600 million afghani.
