MANILA -- Banks should accept unfit or mutilated Philippine banknotes and coins from the public, the Bangko Sentral ng Pilipinas said on Friday. 

The BSP said unfit currency should be exchanged—free of charge—for fit or clean banknotes and coins.

"Under BSP Circular No. 829, series of 2014, and the Manual of Regulations for Banks (MORB), banks are required to facilitate the processing and submission of the public’s mutilated currency to the BSP for examination," the central bank said.

According to the BSP, paper and polymer banknotes are classified as unfit if they are dirty, soiled, limp, stained, or have faded print or visible writings. They are considered mutilated if they are defaced or damaged by burns, tears, perforations, or missing parts due to insects, chemicals, extreme heat (such as fire), or other causes.

Meanwhile, coins are considered unfit if they are bent, twisted, defaced, or corroded but their genuineness and denomination can still be determined. They are classified as mutilated if their genuineness or denomination can no longer be clearly determined due to burns, corrosion, filing, clipping, or perforation, the central bank added.

The BSP warned before that people who mutilate or deface banknotes and coins may face fines and imprisonment.

Fines of up to P20,000 and imprisonment of up to 5 years are possible for people who deface, mutilate, tear, burn or destroy banknotes and coins.

LOOK: BSP educates public on defaced, mutilated banknotes, coins

BSP retires 519.93MT of unfit, mutilated coins to maintain integrity of Philippine currency