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From Chinese Media

Expert urges 500 yuan notes for Chinese money

Updated: 2011-06-16 17:53

By Zhao Chunzhe (chinadaily.com.cn)

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An economist calls for the design of 500 yuan ($74) notes to reduce economic losses in the circulation of China's currency RMB, the Yangcheng Evening News reported.

Mao Yushi, an economist in China, said on his micro blog on Tuesday that the 100 yuan note, the largest face value of RMB, requires quadruple counting efforts compared with the 500 yuan note. It also takes up more space, even posing a bigger risk of theft.

More notes in circulation become damaged and thus more new bills must be printed. China's Central Bank is responsible for the extra cost, but taxpayers are indirectly buying the bills. The yearly loss is estimated at 1 billion to 2 billion yuan, according to Mao.

However, the paper said more people thought it was unnecessary because online payments have become more popular.

Tian Yong, a professor at China’s Central University of Finance and Economics, partly agreed with Yu, but he said that larger notes may bring inflation and make people more concerned about currency devaluation, the paper said.

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