Hong Kong’s Lunar New Year lai see tradition is big business with 400 million more banknotes in circulation

Reading Time:3 minutes

Lydia Yip Siu-Ming, head of the currency and settlement division in the financial infrastructure department of the HKMA, encourages the use of recycled banknotes for lai see. Photo: Dickson Lee

Published: 3:24pm, 29 Jan 2017Updated: 10:44pm, 29 Jan 2017

While the digital era has seen many people go online to manage their financial transactions, whenever Lunar New Year approaches more Hong Kong people visit bank branches for one simple reason – to exchange new banknotes for lai see packets – to the tune of as much as HK$8 billion a year.

Lydia Yip Siu-ming, head of the currency and settlement division in the financial infrastructure department of the Hong Kong Monetary Authority, said the Lunar New Year would require about 300 million to 400 million more banknotes in circulation than usual to cope with increased business transactions and lai see distribution, which itself is valued at HK$8 billion.

About half are newly printed banknotes, which means the authority needed to print about 200 million banknotes for the Lunar New Year.

Currently there are 2 billion banknotes in circulation valued at HK$408 billion, up from HK$157 billion in 2006, with an annual growth rate of 10 per cent over the past 10 years, Yip said in an interview with the South China Morning Post.

“Even after many people are using credit cards or other electronic methods to make payments, there are still many businesses such as supermarkets and restaurants that need to use banknotes for transactions. Tourists prepare cash to spend while lai see money also contributes to the biggest demand for banknotes every year,” she said.

A machine used for Hong Kong banknote production. The HKMA needs to print about 200 million more banknotes for the Lunar New Year. Photo: Handout

It is a Chinese tradition that married people need to give lai see packets with new banknotes, usually HK$20, to children or unmarried young people, as “lucky money”.

Select Voice

Choose your listening speed

Get through articles 2x faster

1.25x

250 WPM

Slow

Average

Fast

00:0000:00

1.25x