1. Issuing of banknotes and coin
Availability of banknotes and coin
The Government has granted the SARB the sole right to issue banknotes and coin in the country. However, all new designs of banknotes and coin must have the prior approval of the Government before they are placed into circulation. The Government also decides on the denominations that should be introduced or removed from circulation, based on recommendations received from the SARB.
The SARB must ensure that sufficient new banknotes and coin are available to replace banknotes that are removed from circulation due to soil levels and coin that are damaged.
The SARB calculates the country’s new banknote and coin requirements on an annual basis.
The SARB places new banknotes and coin into circulation on an ongoing basis. New banknotes are automatically issued by the SARB's cash centres. Orders for new coin are placed with the SARB’s Head Office by the National Specie Committee, which is appointed by the commercial banks.
The value of banknotes and coin in circulation can be obtained from the SARB’s statement of assets and liabilities.
New banknote and coin design
The SARB undertakes projects for the design of new banknotes and coin as required.
2. Managing the quality of banknotes and coin in circulation
The quality of banknotes in circulation is managed in terms of section 14 of the SARB Act and is primarily based on two guidelines:
First, the used banknotes issued by the SARB’s cash centres must be capable of being mechanically handled by cash receiving and/or dispensing machines.
Second, the quality of used banknotes should be acceptable to members of the public when paid to them by the tellers of commercial banks.
In order to manage the quality of banknotes placed into circulation, all banknotes deposited at the SARB’s cash centres are processed on electronic banknote processing machines.
The SARB ensures the availability and adequacy of banknotes and coin throughout the country.
Legal tender refers to banknotes or coin that may be legally offered in payment of an obligation and that a creditor is obliged to accept.
All South African banknotes and coin issued to date remain legal tender. Previous series of banknotes and coin issues are withdrawn from circulation as they are deposited at the SARB.
Any amount in banknotes may be offered for payment. In the case of coin, however, there are limits to how many coins may be used per transaction. The acceptable amount per individual transaction is equal to the total amount, not exceeding the following:
R50, where coin of the denomination of R1 or higher are so tendered;
R5, where coin of denomination of 10 cents up to and including 50 cents are so tendered;
50 cents, where coin of the denomination of 5 cents or less are so tendered; and
The value of a banknote or coin so tendered shall be an amount equal to the amount specified on the banknote or coin.
Only a banknote or coin that has not been defaced or mutilated, and which is lawfully in circulation in the Republic, shall be legal tender.
In the case of gold coin, the SARB will purchase such coin at the value the SARB is willing to pay for gold coin on the day of such tender.
In accordance with section 14 of the SARB Act, the SARB may, at its discretion, reimburse mutilated banknotes and coin that have not been wilfully damaged. Such banknotes and coin can be deposited/exchanged at the commercial banks who will in turn forward them to the SARB.
A banknote is mutilated when its condition is damaged by deterioration, fire or when it has been torn, defaced, soiled or has missing portions. Such a banknote requires a special examination in order to determine its face value.
Guidelines for the payment of mutilated banknotes may be viewed under Public Awareness.
A coin is mutilated when its condition is damaged by deterioration, fire or when it has been partially destroyed.
In terms of sections 14(3) and 14(6) of the SARB Act respectively, the SARB shall not re-issue or cause to be re-issued any banknote which is torn or wholly or partially defaced or soiled, or re-issue or cause to be re-issued any coin which is mutilated or worn away.
Wilfully mutilated coin
In terms of section 34(1)(f) of the SARB Act, it is an offence to wilfully deface, soil or damage a banknote or to wilfully deface or damage a coin.
Dye Stained Banknotes
As stated above, it is an offence to wilfully deface, soil or damage a banknote.
Although currency protection devices deface banknotes, the SARB permits the use of these devices as a means to protect currency against crime, to deter robberies/theft and to serve as a means of identifying the proceeds of crime, as part of its constitutional and statutory obligation to protect the integrity and value of the currency.
Dye-stained banknotes − refers to banknotes that have been stained with ink and/or smoke, or a combination of both, by the activation of a SARB-approved currency protection device.
Controlled dye-stained banknotes − refers to banknotes that have been dye-stained by the activation of a SARB-approved currency protection device due to an accidental discharge and/or during a bona fide robbery or attempted heist where the banknotes are contained and/or recovered in a controlled manner by the user of the device.
Uncontrolled dye-stained banknotes − refers to dye-stained banknotes in circulation that land in the hands of the public as a result of theft and which banknotes have been stained by an activated currency protection device.