Money, trade, and issues of sovereignty have been curiously intertwined. The history of Philippine money follows an interesting timeline - from the pre-Hispanic era to the Republic of the Philippines that we know today.
The Peso is the official currency of the Philippines, and Piso is its Filipino name. PHP is its ISO code. The Bangko Sentral ng Pilipinas (BSP), the Philippines' central bank is the issuer of the Philippine Peso. The peso is subdivided into 100 cents (sentimo).
A Brief History Of The Philippine Peso
The history of the Philippine Peso through the years can be divided into different periods based on the ruling power of the time. The evolution of the Philippine peso reflects the country's journey through colonization and independence.
Pre-Hispanic Era
Prior to the arrival of Spaniards in the Philippines in 1521, trade among the early Filipinos and traders from China and other neighboring lands was performed using the barter system. Cowry shells then were adopted as a medium of exchange due to the inconvenience of the barter system.
Piloncitos, which are small pieces of gold, became the first form of coinage. It had a flat base engraved with an inscription of the letters "MA" or "M" that resembles the Javanese script of the 11th century. It is believed that this inscription was used by the Chinese traders to identify the Philippines during the pre-Spanish era.
Spanish Occupation (1521-1897)
The Spanish introduced the coins to the Philippines. The cobs or macuquinas of colonial mints were the earliest coins that were brought in. These were minted in various Spanish countries around the world.
The Spanish dos mundos that were extensively circulated worldwide from 1732-1772 also reached the Philippines. The coin features twin crowned globes reflecting Spanish rule over the Old and the New World.
The shortage of fractional coins at the time led the Spanish government to create the barillas, crude bronze or bronze coins worth about one centavo in the Philippines. The Filipino term "barya", meaning "small change," had its origin in barrilla.
Coins from other Spanish colonies that reached the Philippines were counter-stamped to legally circulate in the country. Gold coins with the portrait of Queen Isabela were minted in Manila. Silver pesos with the profile of Alfonso XII were the last coins minted in Spain.
The first paper money in circulation was the pesos fuertes which were issued by the country's first bank, the El Banco Espanol Filipino de Isabel II.
Revolutionary Period (1898-1899)
The 1898 Declaration of Independence brought a short-lived revolutionary currency replacing the Spanish-Filipino Peso. The first Philippine president, General Emilio Aguinaldo, issued its own coins and paper currency under the Malolos Constitution.
Two types of two-centavo copper coins were introduced into the system. Revolutionary noted in denominations 1, 5, and 10 pesos were printed and hand-signed by Pedro Paterno, Mariano Limjap, and Telesforo Chuidian.
Revolutionary currency was withdrawn from circulation and declared illegal currency after the arrival of the Americans in 1898 and the eventual surrender of General Aguinaldo to the Americans.
American Occupation (1900-1941)
The United States took possession of the Philippines in 1901 and established a new unit of currency. The introduction of modern banking, credit systems, and currency made the Philippines one of the most prosperous countries in East Asia.
The country's monetary system was based on the gold standard, and the Philippine peso was pegged to the American dollar exactly half of a US dollar or 2 pesos per USD in 1903 until the country became independent in 1946.
The coins issued bore the designs of Filipino engraver and artist, Melecio Figueroa. Coins in the denomination of one-half centavo to 1 peso were minted.
El Banco Espanol Filipino was renamed to Bank of the Philippine Islands in 1912. After which, all the notes and coins issued up to 1933 were changed from Spanish to English. The treasury certificates replaced the silver certificates series, and a one-peso note was added beginning May 1918.
The Japanese Occupation (1942-1945)
World War II caused severe disturbances to the Philippine monetary system. During the Japanese Occupation of the Philippines, two kinds of notes were issued. These war notes were in big denominations and had no backup reserves. The Filipinos dubbed it "Mickey Mouse" amidst the worst inflation in the history of the Philippines.
On the other hand, provinces and municipalities issued their own guerrilla notes or resistance currencies which were in low denominations. Most of these were sanctioned by the Philippine government-in-exile to show resistance against the Japanese occupation.
The Philippine Republic
The establishment of the Central Bank of the Philippines in 1949 led to the reintroduction of a formal Filipino currency. The first currencies issued were the English series of banknotes and later in the late 1960s, became more filipinized with the adoption of the Filipino language in the currency and the images of national heroes. A series of notes in denominations of 1, 5, 10, 20, 50, and 100 pesos was launched in 1969.
In 1973, the Ang Bagong Lipunan (ABL) series notes were circulated. The lowest denomination was the 2 peso, and the highest denomination was the 100 peso.
The ABL series was followed by the New Design Series (NDS). The new 500 pesos was launched in 1987. The BSP issued the first 1,000 peso notes in 1991 and 200 peso notes in 2002. It was later retitled as the BSP series and bore the new seal of the BSP.
In 2009, the BSP launched a massive redesign for the current notes and coins to enhance security and increase longevity. The notes displayed popular Filipinos and iconic natural wonders.
In December 2010, BSP released the New Generation Currency (NGC) Series. The full set of NGC coin series consisting of 1 sentimo, 5-sentimo, 25 sentimo, and the 1-piso, 5 piso, and 10 piso coins were released in March 2018.
The Philippine Peso Today
Banknotes
Currently, banknotes of denominations of 20, 50, 100, 200, 500, and 1,000 pesos are in circulation. All notes are of vibrant colors and have images of famous Filipinos and events in Philippine history as well as the country's endemic fauna and flora and natural riches. The bills' size does not vary but is distinctly different in colors.
In February 2016, the BSP distributed a new 100-peso note, which came with a better purple or purple hue. The 100 peso of the NGC series is still in circulation. The NDS in circulation since 1985 was demonetized in 2017.
On December 11, 2019, the BSP announced that the 20 peso note would be converted into a coin.
Coins
Currently, coins of 1,5,10 and 25 cents and 1, 5, 10, and 20 pesos are in use. These coins are from the previous BSP coin series and the newly released NGC coin series.
The BSP declared a redesign of the 5-peso coin of the NGC series. The new design requires the inclusion of bumps on both sides of the coin.
Errors In Coins And Banknotes
100- Piso Bill Error Of 2005
The 100-Piso bill became a subject of controversy after the bill was printed with the then President, Gloria Macapagal-Arroyo was misspelled. The bills incorrectly spelled the President's name as "Gloria Macapagal-Arrovo'' instead of the correct "Gloria Macapagal-Arroyo." 2 million of the erroneous notes were already in circulation as legal tenders prompting a public apology from the BSP.
Many collectors have fueled a secondary market for coins and note with errors using platforms like eBay, where buyers and sellers can bid and auction. Bills with "Gloria Macapagal-Arrovo" became a much sought-after collectors' item.
Philippine Peso Was As Good As An Emirati Dirham In 2006
By August 2006, it became publicly known that the Philippine 1 peso coin is equal in size and weight to a UAE 1 dirham coin. This led to fraud in places that accepted Dirham coins, such as vending machines and parking tickets.
Similar frauds have also occurred in the United States, as the 1 peso coin is roughly the same size as the USD 25 cents coin. Although digital parking meters were not affected, most vending machines will still likely accept it as a quarter.
In the most recent case, President Rodrigo Roa Duterte's middle name was misspelled as "Boa" in the 1,000 Peso banknotes released in 2010. However, the BSP denied that the PHP 1,000 bills with the incorrect surname of the president are not recognized as legal tender by the BSP and did not come from its printing facility in Quezon City.
Fake or counterfeit notes are another problem that all governments and central banks need to watch closely. The BSP runs a reward scheme to encourage the public to report any information on currency counterfeiting, defacement/mutilation of Philippine currency banknotes and coins, or any activity pertaining to currency integrity.
History Of USD To PHP
In the history of USD to PHP exchange rate pairing, USD to PHP reached an all-time high of 56.341 in October 2004 and a record low of 2.000 in Jan 1962. The conversion rates of USD/PHP today stand at 1 USD to 51.33 PHP at the time of writing.
The exchange rate fluctuates daily. Many factors affect the exchange rate. The value of the Peso has slumped over the years. However, the weak PHP against the USD has one silver lining: the Overseas Filipino Workers (OFWs) can send more pesos in remittances to families in the Philippines.
OFW remittances are an important source of foreign income for the Philippines. In fact, the United States was the highest source of remittances in 2020, accounting for around 11.94 billion U.S. dollars.
In addition to exchange rates, fees on money transfers impact the remittances being sent. While it is not possible to avoid the transfer fees every single time, there are cheap ways of sending money to the Philippines from the US.
In conclusion, to understand the evolution of PHP, we had to understand the evolution of the Republic of the Philippines. The sensitivity around the topic is an interest for many fields of research.
While socio-political factors impact a currency's standing, it is mostly down to the basic economics - demand and supply. The value of PHP in relation to other currencies is what we know as the exchange rate, such as USD to PHP. Because exchange rates fluctuate daily if you send money from the US to the Philippines, always compare USD to PHP rates before sending money.
FAQs
How will you describe the evolution of the Philippine currency? ›
In 1898, the country issued its currency backed by the Philippines' natural resources. In 1902, the US captured the Philippines and established a new currency pegged to gold, about half the price of a US dollar then. In 1993, the Philippine peso became a floating currency.
Where did the Philippine peso originate from? ›The Philippine peso is derived from the Spanish peso or pieces of eight brought over in large quantities from Spanish America by the Manila galleons of the period from the 16th century to the 19th.
When did Philippine peso change? ›New Generation Currency (current)
The new banknote designs feature famous Filipinos and iconic natural wonders. Philippine national symbols will be depicted on coins. The BSP started releasing the initial batch of new banknotes on December 16, 2010.
The Philippine real was the currency of the Philippines during the Spanish Colonial Era. Brought over in large quantities by the Manila galleons, eight silver reales made up a silver peso or a dollar.
What is the history and evolution of money? ›Before money was invented, people bartered for goods and services. It wasn't until about 5,000 years ago that the Mesopotamian people created the shekel, which is considered the first known form of currency. Gold and silver coins date back to around 650 to 600 B.C. when stamped coins were used to pay armies.
What is evolution of money explain? ›The need to facilitate exchange of goods led to the evolution of money. The world went through a stage when money was not in use and goods were exchanged directly for one another, in a system called the barter. The inconveniences and drawbacks of barter led to the gradual use of a medium of exchange.
When was the Philippine peso the strongest? ›Historically, the Philippine Peso reached an all time high of 59.20 in September of 2022. Philippine Peso - data, forecasts, historical chart - was last updated on December of 2022.
When was the first peso made? ›The peso was introduced into Spain by the monarchs Ferdinand and Isabella, who reformed the Spanish coinage system in 1497; it did not come into common use, though, until the time of Charles I (the emperor Charles V).
Who created the peso currency? ›For decades after Mexico gained its independence from Spain in 1821, the Mexican government continued to use the Spanish monetary system. The first one-peso coin was issued in 1866 under Emperor Maximilian I. Departing from the tradition of the reales, each peso was made up of 100 centavos.
Why is the Philippine peso getting stronger? ›Chief Economist Michael L. Ricafort attributed the peso's appreciation to the increase in the country's gross international reserves (GIR) as of October. Data from the central bank showed GIR stood at $94.1 billion at end-October, up 1.9% from the $93 billion at end-September.
How many types of pesos are there? ›
Paper money currently used is in the denominations 20 peso, 50 peso, 100 peso, 200 peso, and 500 peso. Coins in denominations of 20 and 50 centavos (100 centavos makes up 1 peso), and 1 peso, 2 peso, 5 peso, 10 peso, and 20 peso are also in circulation.
Why is it called Philippine peso? ›PHP is also called piso, a Filipino name. Since the country was a previous United States colony, it used the English language on its notes and coins. Hence, until 1967, the term “peso” appeared on the currency. With the introduction of the Filipino language on the notes and coins, the word “piso” came into use.
What is the old money in the Philippines? ›The pesos fuertes, issued by the country's first bank, the El Banco Espanol Filipino de Isabel II, were the first paper money circulated in the country.
When was the Philippine peso at its lowest? ›The Philippine currency peso sank to its lowest level in history at 56.99 pesos to one U.S. dollar. MANILA, Sept. 6 (Xinhua) -- The Philippine currency peso Monday sank to its lowest level in history at 56.99 pesos to one U.S. dollar, data from the Bankers Association of the Philippines showed.
What were previous pesos called? ›History. Before 1826, the Spanish silver eight-real coin was named the Peso. After Argentina became independent, the country started using new coin denominations: Escudos, Soles, and Reales. The coins were in circulation until 1881.
What are the main stages of evolution of money? ›Some of the major stages through which money has evolved are as follows: (i) Commodity Money (ii) Metallic Money (iii) Paper Money (iv) Credit Money (v) Plastic Money.
What is the first evolution of money? ›Cowrie shells and other items from nature
Some of the earliest currencies were objects from nature. A notable example is cowrie shells, first used as money about 1200 BCE. Although they may seem a pretty random choice, the shells had a number of advantages: they were similar in size, small, and durable.
Different stages of money are Commodity Money, Metallic Money, Paper Money, Credit Money, and Plastic Money.
What is the conclusion of evolution of money? ›After bartering someone came up with this genius idea of money, it was then turned into money, people had to work to get money, people then started to get richer and richer until bills, economy and inflation became a thing so then people weren't so rich anymore and didn't have much money as they did before bills.
Why is the Philippine peso losing value? ›The government says the peso's fall is due to external factors. The United States (US) Federal Reserve is particularly blamed for its aggressive interest rate hikes since the start of the year.
Why the Philippines peso has a lower value in the market? ›
To maintain growth, the Philippines has raised imports since its productive capacity is still lagging due to COVID-19's shocks. Further downward pressure on the peso also came from increased speculation on commodity prices.
Why is Philippine peso value so low? ›This is due to our growing dependence on imports and declining exports; our lack of strong local industries to cushion the negative impact of the two-year debilitating pandemic; the weakened economies in the host countries of overseas Filipinos, which prevented them from sending more dollars home or worst, caused them ...
Who signed the first peso bill in the Philippines? ›First Philippine Republic
The revolutionary republic of Emilio Aguinaldo ordered the issuance of 1, 2, 5, 10, 25, 50, 100-peso banknotes which were signed by Messrs. Pedro A.
The PESO aims to ensure prompt and efficient delivery of employment facilitation services as well as to provide timely information on labor market and DOLE Programs. Core Services: Labor Market Information. Referral and Placement.
Why is the peso model important? ›The PESO model in marketing is important because it combines various marketing techniques and activities to create and build a strong presence. Marketing using the PESO model optimizes your content in every sphere, from sharing your content to engaging your customers.
Is Philippine peso floating? ›Philippine pesos currently circulate in banknotes of 20, 50, 100, 200, 500, and 1,000 pesos. The currency underwent substantial devaluation under the pegged system but became free-floating after the nation's 1993 New Central Bank Act.
Why is the peso so weak? ›“We see the peso facing further weakness as imports increase, while exports are dragged down by weakening Chinese demand, widening the trade deficit,” said Trinh Nguyen, a senior economist at Natixis SA in Hong Kong.
Who will benefit if the peso is high? ›On the one hand, a firm peso confers benefits to the economy—the consumers in general (by tempering the general rise in the prices of goods and services or inflation arising from increases in international prices of imported or import‐based commodities), importers, Filipinos who travel or invest abroad, and those who ...
What is the largest peso bill? ›The note of the lowest denomination (20 pesos) is the smallest one, measuring 120-mm in length, and the note of highest denomination (1,000 pesos) is the longest, at 155-mm long. From each denomination to the next one (20, 50, 100, 200, 500 and 1,000) there is a difference of 7 mm in length.
What are pesos called? ›The Mexican peso (MXN) is the official currency of Mexico. It is subdivided into 100 centavos. The currency was initially based on Spain's official currency, called 'real', which was the Spanish dollar. The Mexican peso's name originated from the silver 8-real coins issued by Spain in Mexico.
Do old pesos have value? ›
a $100,000 peso note dating back to 1991 is exchangeable today for a current-day $100 peso note; $1 and $5 peso notes dating back to pre-1975 are worth fractions of a Mexican cent and are now no more than museum pieces and collectors' items.
How Philippine money is created? ›Philippine coins and banknotes are mostly produced in the BSP Security Plant Complex (SPC). Over the past four decades, the SPC has become a world-class producer of quality coins and notes. It has overseen the design, production and issuance of four generations of legal tender Philippine currency.
What is the original peso? ›The name peso was given to the 8-real silver coin introduced in 1497, minted at 83⁄8 pesos to a Castilian mark (230.0465 grams) of silver 134/144 fine (25.56 g fine silver).
What is the rarest peso bill in the Philippines? ›...
Philippine two hundred-peso note.
| (Philippines) | |
|---|---|
| Years of printing | 1903–1928; 1949-1959; 2002–present |
| Obverse | |
Sterling is the world's oldest currency that is still in use and that has been in continuous use since its inception.
Who benefits from a weak peso? ›In a Senate hearing last week, Philippine Finance Secretary Benjamin Diokno said the weak peso benefits the country's economy as dollar-earning exporters and families of overseas Filipino workers who send cash remittances get more value for their bucks.
Why was peso devalued? ›When its ability to obtain foreign exchange weakened, Mexico was forced to increase its foreign debt simply to meet obligations from past financial arrangements. Pressure on the Mexican Government to encourage exports and dis- courage imports increased, and the peso was devalued in February 1982.
What is the second oldest currency? ›The ruble is the currency of the Russian Federation. The ruble has been used since the 13th century, making it the second-oldest national currency still in existence, behind the British pound.
How will you describe the Filipino value system? ›Filipino values system is defined by was of peo- ple live their life as an influence to one's culture. The proverb is a reflection of Filipino sensitivity towards dealing with others. They are cautious and careful when they commune with others.
How would you describe the economy of Philippines today? ›The Philippines economy has shown strong growth momentum in early 2022, with GDP growth rising to 8.3% year-on-year (y/y) in the first quarter of 2022. The easing of domestic COVID-19 restrictions allowed the rebound of household consumption spending, which helped to drive strong economic growth.
How will you characterize the Philippine currency during pre Spanish period? ›
Pre-Hispanic Era
The inconvenience of the barter system led to the adoption of a specific medium of exchange – the cowry shells. Cowries produced in gold, jade, quartz and wood became the most common and acceptable form of money through many centuries.
The new 20-Piso and enhanced 5-Piso NGC coins shall co-exist as legal tender with the currently-circulating 20-Piso NGC banknotes and round 5-Piso NGC coins, which will be removed from circulation through natural attrition.
What are the Filipino values and give a brief explanation of each value? ›Hiya, pakikisama, utang na loob & respect to others make a Filipino an individual with unique moral obligation to treat one another resulting to community ties. These values make Filipinos friendly, hospitable, polite & loyal. In brief, the Filipino core values influence how they behave in any situation.
How important is understanding Filipino value system? ›Filipino values inform and influence how we work and live. Discover who we really are and explore opportunities to live and work with us. If you want Filipinos to become effective, there is no need to supplant Filipino values with western values.
What do you think is the most important Filipino value? ›- The family. Filipinos are known to have strong family ties. ...
- Humor and positivity. Optimism, humor, and positivity are valued traits in the Philippines. ...
- Flexibility and adaptability. ...
- Faith and religion. ...
- Filipino hospitality. ...
- Respect for the elderly. ...
- Industrious attitude. ...
- Generosity.
Between 1972 and 1979, the Philippines enjoyed its best economic development since 1945.
What type of economic system is the Philippines? ›The Philippines has a mixed economic system that includes a variety of private freedom, combined with centralized economic planning and government regulation. The Philippines is a member of the Asia-Pacific Economic Cooperation (APEC) and the Association of Southeast Asian Nations (ASEAN).
What is the main economic problem that the Philippines is facing today? ›high inflation during crisis periods; high levels of population growth; high and persistent levels of inequality (incomes and assets), which dampen the positive impacts of economic expansion; and. recurrent shocks and exposure to risks such as economic crisis, conflicts, natural disasters,and "environmental poverty."
What is the importance of Philippine Peso? ›A vibrant representation of not only the Filipino figures and natural riches they are embellished with, the ever-developing Philippine Peso has also come to represent the country's vigorous journey through colonization and independence.
What is the importance of peso in our life? ›The one-peso coin is the workhorse of Philippine currency and as such it is fuel that drives everyday Filipino commerce, Rizal being exchanged from one hand to another countless times in a day.
Is the currency in precolonial Philippines? ›
Piloncitos (also known as bulawan, and as "granitos de oro" in very early records) are small "bead-like" pieces of gold which were used as currency during the Philippines' Archaic period and in the earliest years of the country's Spanish colonial period.
What is the oldest Philippine coin? ›Barilla was the first coin struck in the Philippines as ordered by the Royalty of Spain. It bore the coat-at-arms of the City of Manila and the inscription Ano de 1728.