Euro adoption - Bed and breakfast with the euro
John Cassar Torreggiani
One of the benefits of euro adoption is that it will make life easier for our guests.
Being ready to trade in the euro is a natural progression in our tourist industry's drive to offer a high quality service to our guests. Many visitors from mainland Europe are from the euro area, a potential market of over 300 million persons. To capitalise on this market, the Maltese tourist industry is pro-actively welcoming the euro as our currency.
As this stage of the changeover process, the banking community would like to recommend that the following areas are taken into consideration by tourist operators be it hotels, casinos, small bars and restaurants or airlines:
• Information Technology: Make sure that your IT systems are euro compatible by speaking to your suppliers. Ensure that testing and actual simulations on your IT systems have or are planned to take place prior to e-day;
• Security Features: Make sure that your staff members are well informed and trained about the security features of both the Maltese lira and the euro. Do not exchange cash from unauthorised dealers due to the risk associated with counterfeits;
• Cash Management: Calculate the amount of your cash requirements for the first week of the adoption of the euro. See how many cash points you will be operating with in the first week of January 2008. Start determining the amount of "retail euro coin starter packs" (each having a value of €131) you intend to purchase from the bank from December 1, 2007. This special arrangement also applies for the five euro notes only. Start placing your order for euro retail starter packs and euro five notes requirements with your bank branch manager;
• Sub frontloading: In preparation for the euro changeover, businesses with a high cash requirement will be considered for "sub frontloading". Sub frontloading involves the provision by the bank of large amounts of euro cash to businesses prior to euro conversion. This will enable them to operate smoothly during the first few days after conversion. Potential candidates for sub frontloading include foreign exchange bureaux, large supermarkets, casinos and groups of companies handling significant amounts of cash.
Bank of Valletta plc has set minimum thresholds to qualify for sub frontloading arrangements, namely: Coins - Minimum of €5,000 (worth of coins) and banknotes - Minimum of €40,000 (worth of notes). Each sub frontloaded business has to sign a contract through which the customer agrees, among other conditions, that he is:
(a) Not to utilise cash prior to January 1, 2008;
(b) To keep the euro consigned to them in a secure and safe place;
(c) To keep the sub frontloaded cash separate from other cash;
(d) To allow Central Bank of Malta Officials to inspect the sub frontloaded euro cash at any time; and
(e) To be liable to a 10 per cent fine on the sub frontloaded amount, if found in breach of any of the above conditions or any other conditions stipulated in the contract.
• Electronic Point of Sales (EPOS): Make sure that your staff is aware how your electronic point of sales will be converting to euro. Bank of Valletta is publishing a special Euro Edition of BOV Accept that will be explaining the process.
• Cheques: Is your staff aware how cheques should be handled. One can find a leaflet in this regard from all bank branches;
• Deposits of Maltese lira notes and coins: As part of the national dehoarding campaign, we recommend surplus Maltese lira notes and particularly coins are deposited into the banking system from now.
• Mr Cassar Torreggiani is the executive head responsible for the euro changeover programme at Bank of Valletta.
Being ready to trade in the euro is a natural progression in our tourist industry's drive to offer a high quality service to our guests. Many visitors from mainland Europe are from the euro area, a potential market of over 300 million persons. To capitalise on this market, the Maltese tourist industry is pro-actively welcoming the euro as our currency.
As this stage of the changeover process, the banking community would like to recommend that the following areas are taken into consideration by tourist operators be it hotels, casinos, small bars and restaurants or airlines:
• Information Technology: Make sure that your IT systems are euro compatible by speaking to your suppliers. Ensure that testing and actual simulations on your IT systems have or are planned to take place prior to e-day;
• Security Features: Make sure that your staff members are well informed and trained about the security features of both the Maltese lira and the euro. Do not exchange cash from unauthorised dealers due to the risk associated with counterfeits;
• Cash Management: Calculate the amount of your cash requirements for the first week of the adoption of the euro. See how many cash points you will be operating with in the first week of January 2008. Start determining the amount of "retail euro coin starter packs" (each having a value of €131) you intend to purchase from the bank from December 1, 2007. This special arrangement also applies for the five euro notes only. Start placing your order for euro retail starter packs and euro five notes requirements with your bank branch manager;
• Sub frontloading: In preparation for the euro changeover, businesses with a high cash requirement will be considered for "sub frontloading". Sub frontloading involves the provision by the bank of large amounts of euro cash to businesses prior to euro conversion. This will enable them to operate smoothly during the first few days after conversion. Potential candidates for sub frontloading include foreign exchange bureaux, large supermarkets, casinos and groups of companies handling significant amounts of cash.
Bank of Valletta plc has set minimum thresholds to qualify for sub frontloading arrangements, namely: Coins - Minimum of €5,000 (worth of coins) and banknotes - Minimum of €40,000 (worth of notes). Each sub frontloaded business has to sign a contract through which the customer agrees, among other conditions, that he is:
(a) Not to utilise cash prior to January 1, 2008;
(b) To keep the euro consigned to them in a secure and safe place;
(c) To keep the sub frontloaded cash separate from other cash;
(d) To allow Central Bank of Malta Officials to inspect the sub frontloaded euro cash at any time; and
(e) To be liable to a 10 per cent fine on the sub frontloaded amount, if found in breach of any of the above conditions or any other conditions stipulated in the contract.
• Electronic Point of Sales (EPOS): Make sure that your staff is aware how your electronic point of sales will be converting to euro. Bank of Valletta is publishing a special Euro Edition of BOV Accept that will be explaining the process.
• Cheques: Is your staff aware how cheques should be handled. One can find a leaflet in this regard from all bank branches;
• Deposits of Maltese lira notes and coins: As part of the national dehoarding campaign, we recommend surplus Maltese lira notes and particularly coins are deposited into the banking system from now.
• Mr Cassar Torreggiani is the executive head responsible for the euro changeover programme at Bank of Valletta.