The South African rand (sign: R; code: ZAR) is the official currency of South Africa. It takes its name from the Witwatersrand ("white waters' ridge" in English), the ridge upon which Johannesburg is built and where most of South Africa's gold deposits were found. The South African rand is legal tender in the Common Monetary Area member states of Namibia, Lesotho, and Eswatini, with these three countries also having national currencies (the dollar, the loti, and the lilangeni respectively) pegged with the rand at parity and still widely accepted as substitutes.
Here's a detailed look at the history and features of South African banknotes.
Early History and Introduction
The rand was introduced in the Union of South Africa in 1961, three months before the country declared itself a republic. A Decimal Coinage Commission had been set up in 1956 to consider a move away from the denominations of pounds, shillings, and pence; it submitted its recommendations on 8 August 1958. It replaced the South African pound as legal tender, at the rate of 2 rand to 1 pound, or 10 shillings to the rand.
Fluctuations and Economic Factors
By the early 1980s, high inflation, mounting political pressure, and sanctions placed against the country due to international opposition to the apartheid system had started to erode its value. The currency broke above parity with the dollar for the first time in March 1982. It continued to trade between R1 and R1.30 to the dollar until June 1984, when the currency's depreciation gained momentum. By February 1985, the currency was trading at over R2 per dollar.
A host of local and international events influenced the currency after that, most notably the 1994 general election, which had it weaken to over R3.60 to the dollar; the election of Tito Mboweni as the governor of the South African Reserve Bank; and the inauguration of President Thabo Mbeki in 1999, which had it quickly slide to over R6 to the dollar. This sudden depreciation in 2001 led to a formal investigation and a dramatic recovery.
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From 9 to 13 December 2015, over four days, the rand dropped over 10% due to what some suspected was President Jacob Zuma's surprise announcement that he would be replacing the Finance Minister Nhlanhla Nene with the little-known David van Rooyen. The rapid decline in value stemmed from when Zuma backtracked and announced that the better-known previous Minister of Finance, Pravin Gordhan, would instead be appointed to the post.
In September 2017, Goldman Sachs said that the debt and corruption of Eskom Holdings was the biggest risk to South Africa's economy and the exchange rate of the rand.
Coinage History
Coins were introduced in 1961 in denominations of 1⁄2, 1, 2+1⁄2, 5, 10, 20, and 50 cents. In 1965, the introduction of 2-cent coins replaced the 2+1⁄2 cent coins. The 1⁄2 cent coin was last struck for circulation in 1973. The 1 rand coin for circulation was introduced in 1967, followed by 2 rand coins in 1989 and 5 rand coins in 1994. To curb counterfeiting, a new 5-rand coin was released in August 2004.
On 3 May 2023, the South African Reserve Bank announced that a new series of coins would be released. These will have the same denominations as the previous series.
Banknote Series and Designs
The first series of rand banknotes was introduced in 1961 in denominations of 1, 2, 10, and 20 rand, with similar designs and colours to the preceding pound notes to ease the transition. They bore the image of what was believed at the time to be Jan van Riebeeck, the first VOC administrator of Cape Town.
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In 1966, a second series of banknotes with designs that moved away from the previous pound notes was released. Notes with 1, 5, and 10 rand denominations were produced with predominantly one colour per note. A smaller 1 rand note with the same design was introduced in 1973, and a 2 rand note was introduced in 1974. The 20 rand denomination from the first series was discontinued.
The 1978 series started with denominations of 2, 5, 10, and 20 rand, with a 50 rand introduced in 1984. This series had only one language variant for each denomination of note. The 2, 10, and 50 rand had Afrikaans first, while the 5 and 20 rand had English first.
Brief Intro to the South African Rand (ZAR) | #CurrencyBytes | SupremeForex
The "Big Five" Series
During the 1990s, the banknotes were redesigned to feature images of the Big Five wildlife species. 10, 20, and 50 rand notes were introduced in 1992 & 1993, retaining the colour scheme of the previous issue. Coins were introduced for the 2 and 5 rand, replacing the notes of the previous series, mainly because of the severe wear and tear experienced with low-denomination notes in circulation.
The 2005 series has the same principal design but with additional security features, such as colour-shifting ink on the 50 rand and higher and the EURion constellation.
In 2011, the South African Reserve Bank issued defective 100 rand banknotes that lacked fluorescent printing visible under UV light. The South African Reserve Bank shredded 3.6 million 100-rand banknotes printed by Crane Currency because they had the same serial numbers as a batch printed by the South African Bank Note Company.
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Commemorative Banknotes: Nelson Mandela Series
On 18 July 2018, a special commemorative series of banknotes was released in commemoration of the 100th anniversary of Nelson Mandela's birth. This series includes notes of all denominations: 10, 20, 50, 100, and 200 rand. These notes circulate alongside the existing notes.
The notes depict the standard face of Nelson Mandela on the obverse. Still, instead of the Big Five animals on the reverse, they show a younger Mandela with different iconic scenes relating to his legacy. For example, the ten-rand note (R10) features the village where he was born (Birth), and the R20 the home in Soweto where he began both his career and his campaign against apartheid (Life). The background to the R50 is the place where he was taken prisoner (Capture), and the R100 Robben Island, where he was incarcerated for 18 of the 27 years he spent in captivity (Struggle). The highest denomination, R200, depicts the Union Building where he was inaugurated as president in 1994 (Destiny).
| Denomination | Reverse Image | Description |
|---|---|---|
| R10 | Birthplace | Nelson Mandela's birthplace village |
| R20 | Soweto Home | His home in Soweto, where he began his career and campaign against apartheid |
| R50 | Capture Site | The location where Mandela was captured |
| R100 | Robben Island | The island where he was imprisoned for 18 years |
| R200 | Union Buildings | The Union Buildings, where he was inaugurated as president |
The commemorative notes are co-circulating alongside the current Mandela series banknotes until they no longer meet the clean note standards of the SARB. Once SARB has issued all the banknotes in the commemorative set, it will return to issuing the current series.
Security Features and Design Elements
The front of the commemorative notes includes SPARK security inks, with Nelson Mandela’s portrait reflected in the watermark. The notes also feature a Louisenthal ColourShift thread that shows gleaming colours in changing hues when the notes are tilted. As well as being attractive, this element also delivers an effective deterrent to counterfeiters.
Citizens have had the chance to familiarise themselves with the security features of the new banknotes through events such as road shows and other outreach initiatives. Holding the note to the light will reveal a watermark of Mandela on the upper left side, while a representation of the animal that appears on the reverse will be seen in an oval on the lower left. The note’s denomination is written in micro-lettering in the animals just to the left of the main Mandela image. In addition, there are raised lines on the bottom left and right that will help visually impaired people to identify the denomination.
The new notes are decorative as well as functional - each features elements of traditional San rock art, depicting the ancient figures hunting, fishing or engaged in other activities. In terms of size, the new notes are the same as the current banknotes. They are 70mm in height, with 6mm differences in length.
The Hybrid substrate from Louisenthal will help ensure that the banknotes remain clean and intact for longer. The polyester foil coating makes the notes particularly hardwearing, but they still retain the typical soft feel of a banknote due to the cotton core.
