Villagers' coupon issue could fall foul of bank laws
Date: 04/15/2000
Publication: The Nation

Villagers' coupon issue could fall foul of bank laws

A COMMUNITY organisation in the Northeast may get into trouble with the Bank of Thailand for an effort to improve the livelihood of villagers and follow their understanding of the concept of a self sufficient economy.

The Sokkhumpoon Village Commodity Fund Committee in Yasothon province's Kutchum district began printing and issuing coupons three months ago that villagers can use as money within their villages, according to a member of the committee who requested anonymity.

The "Bia" coupons were sold to villagers at the exchange rate of one Bia per baht. They have been distributed in Tambon Naso's Thalat, Sokkhumpoon and Santisuk villages.

The committee issued the coupons to promote frugal spending within local communities, and to control the communities' financial liquidity, the committee member said.

However, officials at the Bank of Thailand are looking into the project to determine whether it violates monetary laws and local administrative authorities have said they are concerned the project could threaten national security.

Yasothon Governor Prasongsak Bundet said he did not see any negative effects of the usage of Bia Kutchum in the three villages and that he also viewed the project as one that fostered the solidarity and economic independence of the three villages.

However, if more villages started issuing their own money coupons, the practice might threaten national security, he said. Additionally, commercial transactions and commodity exchanges between villages could become confused, he added.

Provincial officials have visited the three villages, Prasongsak said. The villagers had designated their villages "Self-sufficient Farming Communities" and are using Bia Kutchum as the currency to purchase commodities from each other, he said.

There are three denominations of Bia Kutchum notes - 20 Bia, 10 Bia, and 5 Bia.

Prior to issuing the coupons, the committee consulted a lawyer to determine whether they were legal, the committee member said. The lawyer told the committee the coupons would not be illegal because they did not bear a royal image, he said.

Furthermore, the coupons have been limited to a particular group of people, which has been done elsewhere by other groups, he said.

However, a source at the Bank of Thailand said that the committee may have violated Thailand's monetary laws. According to the Monetary Act, the central bank alone has the authority to issue bank notes to represent money in the economy.

Because the Bia Kutchum coupons have several features of bank notes and are used as money, their issuance could be considered as a violation of the Act, the source said.

Violations of the Act can result in criminal charges, the source added.

However, the community fund can issue coupons for its members without violating monetary laws if it makes it clear that the coupons do not represent money, and that they are not similar to bank notes, the source added.

The central bank has reportedly instructed its northeastern branch's issue department to gather information on Bia Kutchum coupons. It would consider the motivation behind the usage of Bia Kutchum coupons before making any further move on the issue, the source said.

Thitima Srithanyarat, a resident of Kutchum district, said she admired the Sokkhumpoon Village Commodity Fund for encouraging villagers in Tambon Naso to exchange commodities within their own villages at low prices.

The community fund has received technical support from local and international non-governmental organisations, Thitima said.


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