Currency Department - Annual Review 2013

02/02/2015
All Press Releases In Subject:
Banknotes and Coins
The Bank of Israel Currency Department operates under the authorities established in
the Bank of Israel Law related to issuing banknotes, coins, and commemorative coins,
and regulating the currency system. The Department is in charge of policy, planning
and control over the currency system in Israel, and it includes an Issue Unit and a Cash
Management Unit. The Currency Department is thus responsible for the country’s cash,
from the stage of planning the alignment of quantities of cash with forecast demand,
through the design and issue of banknotes, coins, and commemorative coins, to the
regulation of the cash system’s operation.
The Department’s activity includes counting millions of banknotes and coins
annually, using advanced technology; sorting them; storing them in vaults for routine
and emergency needs; and distributing them to the banking system for use by the public.
The activity also includes integrating security features into the banknotes, formulating
criteria for and control over cash quality; providing training for and supervision of the
banking corporations’ cash centers; and actions in collaboration with the Israel Police
and other entities to prevent counterfeiting.
In 2013, other activities augmented the day to day operations of the Currency
Department. It continued preparations ahead of the issue of the new banknote series, and
the first banknote in the new series, the NIS 50 denomination, was put into circulation
on September 16, 2014—21 Elul 5774. The entry of a new banknote into circulation is
a change that requires preparation and acclimation. The Currency Department invites
the public to learn about the new banknote and the security features integrated into it,
through the explanatory brochures in a variety of languages, on the website—www.
newbanknotes.org.il—or through the mobile application. In parallel with activities
regarding the new series, the Department continued to improve its emergency
preparedness and to integrate automation and improved technologies into its work
processes. This is an initiative that is intended to improve service to the public and to
make the work processes more efficient, while increasing control and reducing risks.
In addition, the Department contributed to the Locker Committee discussions. In 2013,
the Prime Minister appointed a joint committee—headed by the Director General of the
Prime Minister’s Office, Harel Locker—with the objective of examining the possibility
of reducing the amount of unreported capital and money laundering through limiting
and reducing the use of cash and other means of payment. In May 2014, the Committee
published an Interim Report, which included a recommendation to limit the use of cash
in transactions, as some other countries do. The Currency Department participated in
the discussions related to its areas of responsibility, and is planning for the ramifications
that the implementation of the recommendations is expected to have on its activities,
including a reduction in demand for cash. At the same time, the Currency Department
is following the development of advanced means of payment and their possible effect
on trends in use of cash. To that end, it relies on the relevant experience that has been
accumulated worldwide to date, and which shows that in most countries, cash continues
to fill a central role in the payments system, alongside advanced means of payment.
 
In the year reviewed, a commemorative coin issued by the Bank of Israel received a
special prize at the tenth annual Vicenza Numismatica International Competition1 and
was chosen as the “Most Beautiful Architectural Representation on a Coin Minted in
2012”. The NIS 2 silver proof coin was dedicated to the waterworks at Tel Megiddo.
This survey includes comprehensive information on the Department’s activities over
the past year. The Bank of Israel attaches great importance to tightening the connection
with the public and to increasing awareness of currency issues, both academic—
familiarity with the history of currency in Israel, and practical—intelligent consumption,
recognition of the banknotes’ security features, and responsible use of banknotes and
coins