HISTORY OF BANKNOTES AND COIN

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Evolution of money

South African currency has evolved from the early days where bartering with items of value was the prevalent form of trading. Commercial banks kept and secured people’s items of value and in return issued them with promissory notes. To date, this trusted system has evolved to banknotes and coins. Banknotes and coins are used daily for transactions.

 

South Africa has a rich history of currency usage, formalised with the introduction of coin in the region in 1652. Since then the country has used different currencies and coins which were made from copper, silver and gold.

From 1956 to 1958, the Decimalisation Coin Commission explored the decimalisation of South African currency, with their recommendations adopted in the Decimalisation Coin Act of 1959. 

 
Decimals – Coin system used in South Africa
First decimal coin series (1961–1964)
  • In 1961, when the Republic of South Africa was proclaimed, the country formally adopted a decimal system, with coins being converted to their decimal equivalent resulting in the one pound becoming a two rand coin, the one shilling a ten cent coin and the three pence a two-and-a-half cent coin. This system remained in place until 1964.
Second decimal coin series (1965–1988)
  • In 1965, the two-and-a-half cent coin was replaced with the two cent coin. 
  • Between 1965 and 1969, coins had either the Afrikaans wording “Suid Afrika” or the English wording “South Africa”. In 1970, the image of Jan van Riebeeck was replaced with the coat of arms. 
  • In the late 1980s, a committee was appointed to investigate the desirability of issuing a new series of banknotes and coin series for South Africa. This was due to the increase in the price of copper and nickel which resulted in the actual value and cost of producing newly minted coins exceeding the face value.
  • The new series of coins would be manufactured locally. In keeping with international standards, the new coins would be smaller and lighter. The government approved the design of a new series of coins that would be cheaper to manufacture and easier to handle.
 
Third decimal coin series (1989–today)
  • South Africa has six coin denominations in circulation, namely, the 10c, 20c, 50c, R1, R2 and the R5. These coins have different sizes.  The 10c is the smallest at 16mm and the R5 is the largest at 26mm. An important consideration in having the different sizes and rim finishes was that visually impaired people could identify the particular denomination with their fingers when transacting.
  • Circulation coins are made of metal or alloy. These coins are used in everyday transactions, circulating alongside banknotes. Various ridges, rims, serrations and different metals on the coins are incorporated as part of the security features. Machines such as vending machines are programmed with software and sensors to recognise these circulation coins and to accept them accordingly.
  • Electroplated coins were introduced in 1989 as a solution to the escalating costs of materials and manufacturing and the increasing risk of falsification. 
  • A bi-metal R5 coin was launched in 2004 to replace the R5 nickel coin.

 

The third decimal coin series is divided into the following three groups:

 

Coin denominations

In 1652 the first European settlers arrived on South Africa's shores and brought along their countries' coins. A Dutch explorer, Jan van Riebeeck, created a trading station on behalf of the Dutch East India Company. This trading station later become known as Cape Town. Netherlands' official currency, the Dutch guilder, became the official currency used among other currencies brought by different traders and mariners passing through Cape Town.

In 1782 the first paper money was brought to Cape Town. The Rix dollar and the stiver denominations were the issued paper currency of Cape Town. The first notes were handwritten. These notes included a government fiscal handstamp indicating the date of its issue and the note value.

The Dutch East India Company went bankrupt in the late eighteenth century. Great Britain took control of the region, declaring it a British colony in 1806. They introduced their currency, which lasted until 1826. At that time, sterling coinage became the sole legal tender and various foreign currencies were not allowed to co-circulate.

The “Burgers Pond” was issued during 1874 bearing, the portrait of Thomas Francois Burger, South Africa’s first president. After the discovery of gold, South Africa built a mint in Pretoria and began issuing coins depicting Paul Kruger. These coins, issued between 1892 and 1902, were based on the British pound sterling. The minting of South African coins was halted in 1902 as the second Anglo-Boer War had begun. The production of South African coins by Pretoria's Royal Mint began again in 1923 and continued until 1931.

South Africa continued to use the British coin system until 1961 when South Africa gained independence and became a republic. This was the beginning of the South African rand, which takes its name from the Witwatersrand where gold was discovered. On 14 February 1961, the rand, replaced the pound. Rand denominations issued were the R1, R2, R10 and R20. They were signed by Governor Rissik and remained active until 1967.

The SARB does not demonetise its currency.

All banknotes issued by the SARB remain legal tender and retain their respective face value, irrespective of the issue date.

Members of the public will receive the face value for their old series banknotes if they are exchanged at the South African Reserve Bank Head Office in Pretoria or by effecting a deposit at a commercial bank branch where they hold an account. Below is a list of commercial bank branches.

Commercial bank branches