One Federal Budget Surprise: Plastic Money

Before any federal budget is released, we're subjected to days of speculation about what the budget will mean for us. Spending cuts? Potentially higher taxes? Large federal deficit? Check. But there was one budget announcement that managed to fly under the radar this year: our paper money is going plastic.

While the rest of us are trying to use less plastic (five cents for a grocery bag, anyone?), the Bank of Canada is planning to switch from cotton-paper money to a synthetic polymer by the end of 2011. But in this case, going plastic is a good thing. The plastic money, already in use in many countries, including Australia, Brazil, China, and Israel, has many advantages over its paper counterpart.
Plastic money is far more durable. In fact, it's waterproof, so go ahead and leave a few notes in your jeans when you do laundry. More durable notes means less printing costs for the federal government in the long run. The plastic notes are also cleaner, because germs and bacteria can't stick to the polymer's surface. Personally, this fact alone makes me cheer this announcement.

Perhaps most importantly, the plastic notes are harder to counterfeit. Counterfeiting Canadian money has become big business in the past few years, as our dollar has approached parity with the U.S. dollar. With plastic, the Bank of Canada can create more elaborate notes and introduce embedded security features, like clear plastic windows, that just aren't possible with paper notes.

So there you have it, switching to plastic is sometimes a good decision. I just hope Steve Jobs pays attention to this story, because my iPod's been through the wash cycle more times than I care to admit.