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The Cash Use Of The Malaysian Ringgit: Can It Be More Efficient?

Author

Listed:
  • PHILIP HANS FRANSES

    (Econometric Institute, Erasmus School of Economics, POB 1738, NL3000 DR Rotterdam, The Netherlands)

  • MAX WELZ

    (Econometric Institute, Erasmus School of Economics, POB 1738, NL3000 DR Rotterdam, The Netherlands)

Abstract

The current (as of 2012) denominational range of the Malaysian ringgit has banknotes of RM1, 5, 10, 20, 50 and 100, but no RM2. The previous range (1996) carried RM1, 2, 5, 10, 50 and 100, but no RM20. We compare the efficiency of these two ranges with a full range like the Euro has, that is, 1, 2, 5, 10, 20, 50 and 100. We estimate that if the Bank Negara Malaysia would reintroduce an RM2 banknote, the efficiency of the payment system in Malaysia would increase substantially.

Suggested Citation

  • Philip Hans Franses & Max Welz, 2020. "The Cash Use Of The Malaysian Ringgit: Can It Be More Efficient?," Annals of Financial Economics (AFE), World Scientific Publishing Co. Pte. Ltd., vol. 15(01), pages 1-5, March.
    • Handle: RePEc:wsi:afexxx:v:15:y:2020:i:01:n:s2010495220500049
    DOI: 10.1142/S2010495220500049
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