According to the Financial Times, Iranian banks began issuing new banknotes this week. Despite the high face value, their real value is about $7 US, which clearly reflects the scale of depreciation of the national currency. Against the background of economic instability, the country’s residents withdrew money from ATMs en masse, fearing disruptions in the work of electronic payment systems. In some cases, this led to cash shortages and queues at bank branches.
The new banknote is made in pink colors. The front side shows the historical Jame Mosque of the IX century in Yazd, and on the back – the ancient citadel of Bam, the age of which is estimated at about 2.5 thousand years. It replaces the 5 million riyal bill introduced just a few weeks earlier.
The new banknote is a sign of trouble
Experts see the issuance of the new banknote as another sign of serious economic problems in the country. The situation is exacerbated by ongoing military tensions: according to the Financial Times, strikes on infrastructure, including banking facilities, have heightened public concern. In particular, Sepah Bank, which serves both military and civilian customers, was damaged on March 11. After the incident, the financial institution announced the gradual restoration of operations – access to cards and ATMs has already been resumed, and online banking is scheduled to return soon.
Iran’s economy has been under pressure for years due to US sanctions, declining oil revenues and structural problems including corruption. This has led to a sharp devaluation of the rial. The dollar reached a record 1.66 million rials before the latest exchange rate aggravation, after which it declined slightly to around 1.5 million.
Earlier, the country’s authorities had already announced plans to denominate and remove the four zeros from the national currency. However, the zeros are still present on the new banknote – and they are printed less conspicuously, which may indicate gradual preparations for monetary reform.
