Bank Negara Malaysia Expands Automated Cash Processing as Banknote Volumes Decline

Bank Negara Malaysia (BNM) processed 1.7 billion banknotes in 2025, a decline from 2.5 billion in 2024, while significantly increasing the share handled through its automated cash centre (ACC). According to the central bank’s Annual Report 2025, automation accounted for 86% of banknote processing, up from 69% the previous year. The shift reflects a broader effort to strengthen operational resilience, improve efficiency and maintain reliable access to physical currency across the country.

Automation Strengthens Currency Processing Operations

BNM attributed the increased automation to the consolidation of processing activities within a single purpose-built facility. Centralising operations has enabled the bank to enhance efficiency, strengthen risk controls and make greater use of automated systems for sorting and handling currency.

The remaining processing volume is supported by currency operations at BNM’s regional offices in East Malaysia and by the wider cash industry. Registered currency processors play a growing role in day-to-day activities such as collecting, sorting and packaging banknotes before they are redistributed into circulation.

These processors complement the central bank’s operations and help ensure banknotes reach financial institutions and the public in a timely manner. Maintaining this operational network is considered essential to keeping cash readily available across the country.

Recirculation Supports Sustainable Currency Management

BNM highlighted recirculation as a central component of a sustainable cash ecosystem. By reusing banknotes that remain in good condition and ensuring coins return to circulation, the central bank reduces waste and lowers the need for new currency production.

In 2025, the central bank issued 1.9 billion banknotes, with 67% classified as fit banknotes, a slight increase from 66% in 2024. The approach forms part of BNM’s wider efforts to incorporate sustainability considerations into currency management while maintaining uninterrupted distribution nationwide.

Cash Remains Important for Financial System Resilience

Despite rapid growth in digital payments, BNM emphasised that cash continues to play a vital role in the financial system. Physical currency remains accessible during connectivity disruptions or natural disasters, allowing transactions to continue when digital channels are unavailable.

Cash also supports economic participation in rural communities and among unbanked populations. Maintaining robust currency management therefore remains a strategic priority for the central bank, complementing Malaysia’s broader financial resilience initiatives and digital transformation efforts such as those discussed in regional conversations on building trust and resilience in financial systems.

These developments take place alongside wider national efforts to strengthen infrastructure and resilience across digital and financial systems, including initiatives such as Malaysia’s new cyber centre designed to reinforce national digital resilience. Together, such measures aim to ensure both digital and physical financial channels remain reliable under a wide range of conditions.