Under section 8(a) of the Central Bank of Myanmar Law, The Central Bank of Myanmar is acting as the sole issuer of domestic currency, either bank notes or coins.As the monetary authority its the central Bank of Myanmar formulate and implements monetary policy, with the aim to preserve the value of the Myanmar currency and to promote efficient payments mechanisms.
Before Myanmar gained independence from the British, Myanmar was one of the states of India. At that time the Myanmar currency was rupee. Both Burmese and Indian rupees were linked to the Sterling and worth one shilling and sixpence.
The First Schedule of the Currency and Coinage Act of 1946 provided for an issue of 1,5,10,100 rupees currency notes and the Second Schedule for the Board to issue its own coins of 20 and 50 rupees. The notes were to have a peacock watermark, and to be authenticated by the Chairman of the Board. The reverses illustrated various national occupations, with GOVERNMENT OF BURMA in English and marked BURMA CURRENCY LEGAL TENDER IN BURMA ONLY.
When Burma gained independence from the British, it became a republic and the heading on the note was changed to GOVERNMENT OF THE UNION OF BURMA. As the Burma Currency Board notes increased in number, it was decided to demonetizeall those India notes marked “ Legal Tender in Burma Only “ from 1st July 1948. All denominations of coins were released into circulation on 20th July 1950.
With the passage of the Union Bank of Burma Act, 1952, the sole right of currency issued was transferred from the Burma Currency Board to a newly created Currency Department of the Union Bank of Burma with effect from 1st July 1952. The Burma Currency Board was abolished and its asset and liabilities were transferred to the Union Bank of Burma. Another important change in the new currency is the conversion to a decimal system.
Coins were made in nickel; denominations of ½ , 1,2,4 and 8 pe and all had the Chinthe (lion) on the obverse, with vale and AD date in wreath on the reverse. But ½ , 1,2 pe coins were demonetized 1st November 1953. Moreover, the English name for the unit of currency was changed to kyat and decimalized into 100 pyas in 1952. Previously, one rupee was equivalent to16 pe (64 pyas). When the unit of currency was changed one kyat was equivalent to 100 pyas.
When the Union Bank of Burma took over the central bank’s responsibilities, a token issue of the bank notes was made on 1st July 1952. As already explained, the new bank notes had the rupee denominations (1,5,10,100 rupees) that was later connected to kyat. It included peacock water mark. The second issue of bank notes was made in 1958, all with a portrait of Aung San with a peaked cap. The 1,5,10 and 100 kyat were introduced on 12th February 1958 (Union Day), and the 20 and 50 kyat on 21st August. This was the first issue of 20 and 50 kyat notes made for Burma.
The decimal series of coins order from the Royal Mint constituted of 1,5,10,25,50pyas and 1 kyat. Those coins have more inscriptions but the Burmese Lion or Chinthe remains. A start was made at putting them into circulation on 1st October 1952 with the 5 and 10 pyas.
When the revolutionary government took power, it was announced that the high denominations 50 and 100 kyat notes would no longer be legal tender from 17th May 1964 and the new People’s Bank of Burma notes of 1,5,10 and 20 kyats were issued on 30th April 1965, with a portrait of Aung San from his wartime army days. 20 kyats note issued in 1958 and 1964 was demonetized on 3rd November 1985. The existing notes were to be legal tender until they had been withdrawn from circulation.
On 30th September 1972 the People’s Bank was renamed the Union of Burma Bank and 25 kyats were issued. All denominations of coins of the former Union Bank of Burma continued to be legal tender at the time of the 25 kyats note issue. New 1 kyat notes followed on 30th December 1972to circulate alongside People’s Bank 1 kyat and on 30th June 1973 the 10 kyats notes was issued. The 5 kyats note appeared on 31st October 1973, to circulate alongside People’s Bank and Union Bank 5 kyats notes. Union of Burma Bank issued and released in circulation 100 Kyats note on 17th April 1976, 50 Kyats on 30th April 1979, 75 Kyats on 11th November 1985 and 35 Kyats on 1st August 1986 respectively. Moreover, the Union of Burma Bank issued 45 kyats note and 90 kyats note in 22nd September 1987. 100 Kyats note issued in 1952 was demonetized on 17th May 1964. 100 Kyats that issued in 1976 and 50 Kyats issued in 1975 were demonetized on 3rd November 1985. Kyats 25, 35 and 75 notes were also withdrawn from circulation on 5th September 1987.
During 1979 an F.A.O (United Nations Food and Agriculture Organization) 50 pyas also appeared, as well as 50 kyats note. Both the F.A.O coins are reported to have been minted at Security Printing Works Factory.
After the State Laws and Order Restoration Council took power in 1988, the Central Bank of Myanmar issued Lion series and Aung San series was replaced by gradually. Denominations are 1,5,10,20,50,100,200,500 and 1000 kyats notes and 1,5,10,50 and 100 kyats coins. The color of the 1 kyat coin is bronze color, the 5 and 10 kyats coins are golden yellow color and the 50 and 100 kyats coins are silver color respectively on 1st October 2009 Central Bank of Myanmar issued new currency notes of 5000 kyats to easier handling for the people. And new currency notes of 10000 kyats issued to the public effect from 15th June 2012.
Counterfeit notes can be found only in high denominations like One thousand kyats, Five hundred kyats and Two hundred kyats. Those are just printed materials and you can get them by using colour printer. The surface of a forged note is rather smoother than a genuine one and there is no security thread and watermark in it. The public can distinguish easily between genuine and counterfeit notes if they look at them thoroughly. But the volume of counterfeit notes is very small compared to currency in circulation therefore is negligible and hence there is no major problem in Myanmar on occurrence of counterfeits.