Review of the issue of 25 Rs 10/- District Coins in 2014 November

The International Background
Many countries in the World have issued similar coins almost all issued over a period of one or more years, gaining momentum in collector interest over that long period.

Almost all countries which have issued a series of coins is a federation of once independent states which merged to form the present large country. This is clearly not the case for small Lanka which has 25 purely administrative districts under the 9 Provincial Councils created in 1987 by the 13th Amendment to the Sri Lanka constitution.

At the beginning of the project the Sri Lanka Numismatic Society wrote to CBSL and requested that this set be associated with the heritage sites, rather than districts. For example, the UNESCO Heritage site Dambulla gets no mention, overshadowed by Sigiriya in the same district.

The Denomination
Ten Rupees was worth a gold sovereign before the Central Bank was created in 1950. The word silima was used for 50 cents as twenty shillings made a British Pound. A gold sovereign is now worth more than Rs. 40,000. The current Rs. 10 is worth less than the quarter cent when that was demonetised in 1910, and the half cent demonetised in 1941. So the highest denomination coin in Sri Lanka now has no significant buying value. Most Trishaws and long distance bus conductors do not now bother about change below Rs. 5.

In March 2013, Kremnica was awarded a US$6 million contract by CBSL to mint 175 million Rs. 10 coins over the next three years. Adopting a value of Rs. 130 per US$, this works out to Rs. 4.50 per coin. So CBSL makes a 120% seigniorage on the steel Rs. 10 coins they issue into circulation. So the coins that are taken out of circulation by collectors are not a loss to CBSL, but just adds to the shortage of change that the public desperately needs.

Review of Numismatic Products

One each of all of the products in English costs LKRs8250 and in all 3 languages total LKRs16,750.

The Issue of District Coins
The release was publicly announced only on the day of issue by Full page advertisements in Local Newspapers and a CBSL press release posted that morning.

Printed invitations had been received a week before for function at CBSL on Monday the 17th November at 10 AM., but the media informed only by E-mail on Thursday the 13th November.

2014-November 17 Monday
After a formal ceremony, a limited number of packaged coin sets were sold both at CBSL and at the CBSL Economic History Museum. Packaging in the requested language was often not available. Sets of 25 cards had not been pre-packed. Taking one from each of 25 bags at the time of sale not only took time, but also often in error gave duplicates of some while missing others.

When I visited the museum around noon, I was told that stocks were over and to return at 12.30, which became 2 p.m. and later everyone who had hung around for hours was told to come the next day. CBSL had made some loose packs of 25 coins for it's staff and decided to release some of them from their cash counter to clear the queue of waiting public.

2014-November 18 Tuesday
The next day at 9.30 a.m., there was a looooong queue which extended out of the museum building by 10 a.m. Some of those wanting to buy cards when they reached the top of the queue after a long wait were told the full set was not available, and soon all the cards were also sold out. The folders had still not come, but the people waited in the queue as they were expected at 10:30 a.m. I left around 11 a.m. before finding out if they finally arrived. Speaking with some it was clear the frustration in the queue was high.

In the absence of the folders, loose sets of 25 coins with Rs. 250 face value were being traded by the sales counter girl who was patiently taking one coin each out of 25 bags, while more than 50 were waiting for their turn in a slowly moving queue to get one set. That was clearly a waste of time as 2 million of each district coin had been minted - more than enough to meet the demand.

Collector Demand
CBSL had clearly not prepared to meet the demand and wasted a lot of time of their staff and collectors who had come to buy them. When only one set was sold to each person in the queue, coin dealers in Colombo Fort seeing a possible opportunity to make a fast buck sent extra persons to stand in queue and buy up all available stock. This made it more difficult for genuine collectors to purchase their needs from CBSL, without paying a premium to the coin dealers.

If the limited stock was because all had not yet been produced, and will be released in the near future, that should have been clearly announced to discourage dealer speculation. Assuming that the packaging cost was not at a loss to CBSL, I hope CBSL will pack more to supply all of the collector demand in Sri Lanka and abroad and prevent dealers who have stockpiled from profiting.

It is a pity that these 25 district coins were not issued individually, say one per month with maybe a function in each district. It would have been an opportunity to engage with the rural public. Many countries like Britain, Canada, Australia and the United States have issued coin similar sets. The most popular 50 US state series of 25 cent coins was issued over 10 years from 1999 to 2008 with just 5 issued each year in 10 week intervals.

This Sri Lankan set of 25 coins was issued, it is claimed, to create coin collector interest. However, CBSL does not see the need to communicate with the collectors. Letters sent seeking information and offers to help go unanswered. It is therefore not surprising that it leads to very poor public relations.

Ongoing Saga
CBSL was not prepared to meet the demand even locally and probably unaware of the demand from abroad. Interested collectors should send E-mails to address in Press release and ask.

2014-November 19 Wednesday
Just 2 days after release, the Museum announced that all 25 district coin products are not available, but that there will be more coins packaged and sold from sometime early in 2015 January. Loose Uncirculated coin sets maybe available before. The current scarcity should hopefully be temporary.

2014-November 21 Friday
Seven 25 District English folders were put on sale on eBay for US$50 each by a seller registered in Singapore. An instant 500% Markup exploiting the temporary scarcity. By what influence did this recently registered eBay seller get these "sold out" products ? I pity the persons who buy them on eBay for over 6 times the CBSL issue price.

2014-November 22 Saturday
Shiran Cruse of Kandy reports on the issue of loose packs of 25 District coins by Sampath Bank at their Kandy Branch 25th Anniversary Celebrations. CBSL had a stall with an exhibition and sold about 50 copies of the Book under heavy public demand. The scarcity of coins seems to have increased the attraction to the products.

2014-November 23 Sunday
The article One head and 25 tails by Kavan Ratnatunga appeared in the SundayTimes of Sri Lanka on 2014 November 23rd. This Title given by SundayTimes is wrong since it is One Tail and 25 heads.

There has been only 24 circulation commemorative coins issued in the 56 years since 1957 before this set of 25 District coins in 2014. In 12 of these coins both sides of the coin was changed. In the 1978 JR coin, his head was added to the reverse or tail side of the coin. On the other 11 coins all issued since 1995, and these 25 District coins it is the head side that has been changed keeping the reverse the same as the standard circulation issue. On all Ceylon and Sri Lanka coins the value appears traditionally on the reverse.
In most Foreign commemorative coins including the US state quarters it is the tail side that is changed, as the head side gives the legal Authority of the coin.

2014-December 15 Monday
I made an appointment and met with the CBSL Governor and the Suprintendent of Currency. I was informed that the Printers have been instructed not to use Gum on the coins when more folders are manufactured for released in 2015 January.

I was informed by some collectors and dealers that Banks Island wide have been issued by CBSL with Rs10 coins of only the District in which they are located. That would clearly make it very difficult to collect a set of District coins from circulation, as it will take a long time for the coins to redistribute island wide via normal usage. This rumour has been contradicted by by many of us finding coins of most districts within few weeks of issue.

I will keep this Blog updated with latest information available to me.