Damaged money collectors profit on broken bills

Loan, 60, of Ho Chi Minh City, held the bill in her hands, looked at both sides carefully, checked the serial number, and gently inspected the burned corner. She then offered to buy the banknote for VND60,000.

The man agreed and Loan paid up. She put the burned bill in a small bag full of other damaged notes she’d collected that day.

Truong Thi Kim Loan at her weekend market stall on HCMC’s No Trang Long street in June, 2023. Photo by VnExpress/Ngoc Ngan

Loan started collecting damaged banknotes over 20 years ago when her father, a former damaged bill collector, grew too old to move around and make collections.

She rides her motorcycle around neighborhoods every day looking for anyone willing to sell their damaged paper money. Apartment complexes with lots of eateries are fertile ground for her, she says, because amid the hustle and bustle of mealtime rushes, owners and cashiers often accept damaged bills without knowing it. Loan also says small eateries often don’t store their cash carefully, and a lot of notes get mangled just hanging around tiny frenetic kitchen spaces.

Loan normally collects between VND1-1.5 million in broken bills each week. After collecting enough damaged notes, she heads to the bank and trades them in for new bills at a profit.

Many people don’t know that damaged monetary notes are still legal tender. Even though some service providers won’t accept them as payment, they can still be traded in at banks for new bills of the same value. Loan capitalizes on the fact that many people are unaware of this, and even many of those who do know still find it more convenient to trade with her at a loss rather than dealing with a bank.

Collectors normally only buy bills no more than 30% damaged. They pay in accordance with the proportion of damage. Some collectors have fixed rates. Loan always pays VND120,000 for a VND200,000 note and VND300,000 for a VND500,000 note. She also never turns down buying small bills.

"A damaged bill collector should never say no to money," she says.

Broken money collectors in Vietnam go back at least as far as 1885-1954, when French colonists made paper banknotes popular in Vietnam.

Damaged bill collectors’ prime was in the 2000s, when the Vietnamese population was becoming wealthier, and the economy was still cash-based.

But the development of credit cards and online transactions has posed a challenge to those who make their living collecting damaged bills.

However, Tran Lam, 31, from the central province of Quang Nam, and many others are still finding ways to profit from the hustle.

Lam is a moto-taxi driver who started collecting damaged bills six months ago. He mostly finds customers via social media, instead of pounding the pavement like Loan. But the lack of face-to-face interactions makes him approach his transactions more cautiously.

He’s also extra careful because during his first three months in the bill collecting game, he was tricked into buying counterfeit money that the bank wouldn’t accept. He also bought some bills that were so damaged the bank refused to take them.

But he’s learned other ways to turn some risk into opportunity. For example, he’s learned how to differentiate real and counterfeit money, and he’s gained confidence in being able to tell if a person is legit or not based on their appearance and behavior.

"A customer who hesitates to invite me to their home in person is often a scammer," he says.

Lam not only enjoys the income he makes trading the mangled notes for profit, he also likes the occasional breaks he gets to take in the air-conditioned waiting rooms of the bank branches he stops at along the road when he has enough notes to exchange for a decent sum.

He says he spends 20 to 40 minutes a day sorting the bills he collects, and he earns between VND3-5 million a month exchanging them at banks. Most of his customers are too busy to drop by bank offices, and many others are simply people who don’t know they can exchange torn money for fresh cash.

Le Nguyen Tuan Anh, 34, an old banknotes collector in HCMC, sometimes helps his customers sell their damaged bills to collectors and charges a VND100,000 brokerage fee for every million dong he manages to exchange for them. He does not earn much, but he likes doing the favor of helping both sides connect.

Le Nguyen Tuan Anh at his store in HCMC’s Binh Thanh District in June, 2023. Photo by VnExpress/Ngoc Ngan

As an old hand who knows many tricks of the trade, Anh says another profitable enterprise is collecting and selling old, discontinued notes, since they can be sold to antique collectors who are willing to pay top dollar for the rare and historic bills.

"Paper money may lose its perfect mint-condition, but not its value," he says.