6 Essential Facts about South African Money

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South Africa uses the rand, ZAR, as their official currency.

Last updated on May 26th, 2024 at 12:07 pm

 
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South Africa is known for its complicated history, stunning vistas, rich musical heritage, inspiring leaders like Nelson Mandela, and even its colorful rand currency. But there’s more to South African money than its beautiful banknotes.

What currency does South Africa use?

While South Africa gained independence from Britain many years ago, it was still part of the Commonwealth until 1961, when the Republic of South Africa was born. That was the year that South Africa adopted the decimal system and moved away from the British pound, instituting the rand as the country’s official currency.

Here’s everything you need to know about South African money, including where you can use it and how to easily send money to South Africa.

Introducing the South African rand

The rand (abbreviated ZAR or R) is South Africa’s national currency. A single rand is worth 100 cents, and the currency is available as coins and banknotes through commercial banks across South Africa. The South African Reserve Bank (SARB) in Pretoria is the country’s central bank and is responsible for issuing and distributing South Africa’s money.

The SARB celebrated its 100th birthday in 2021, so it’s the oldest central bank on the continent. Since introducing the rand in 1961, the SARB has controlled the design and creation of coins and banknotes. It prints the money locally through its South African Bank Note Company (SABN) subsidiary.

Between 1961 and 1989, some smaller South African coin denominations, like the half-cent and two-and-a-half-cent coins, went out of circulation. The original banknotes have also been re-released several times over the years.

The coins currently in circulation come in three different colors:

  • Red: The red-colored money includes 1-, 2-, and 5-cent coins. They feature birds and consist of a steel core plated with copper alloy.
  • Yellow: The yellow-colored money includes 10-, 20-, and 50-cent coins. They feature flowers and are made with a steel core plated with copper and tin.
  • White: The white-colored money includes 1-rand, 2-rand, and 5-rand coins. They feature antelopes and are made with copper core plated with nickel.

The South African banknotes currently in circulation feature Nelson Mandela on the front and one of the “Big Five” wild animals on the back:

  • R 10 note: Green with a rhinoceros
  • R 20 note: Brown with an elephant
  • R 50 note: Red with a lion
  • R 100 note: Blue with a cape buffalo
  • R 200 note: Orange with a leopard

A series of banknotes released in 2018 as a “Nelson Mandela Centenary” feature images of Nelson Mandela on the back instead of the Big Five animals. These include Nelson Mandela at his birthplace, his home in Soweto, and more.

Six facts about the South African rand

South African money: aerial view of buildings

The rand has a rich history that goes hand in hand with South Africa’s development as a country. Here are six key facts about South African money.

1. Rand banknotes feature multiple languages.

South Africa has eleven national languages, each appearing on at least one of the rand banknotes currently circulating. The R 10 note contains English, Afrikaans, and siSwati, while the R 200 note contains English, Sesotho sa Leboa, and isiZulu, for example.

South Africa’s 11 languages include English, Afrikaans, siSwati, isiNdebele, Setswana, Tshivenda, isiXhosa, Sepedi, Xitsonga, Sesotho sa Leboa, and isiZulu.

2. The first currency in South Africa was Dutch.

In the 1600s, traders from the Netherlands brought the Dutch guilder currency to South Africa, where it became the primary currency for many years. In 1782, they brought the first paper money into Cape Town as the rix dollar.

Dutch currency was commonplace in South Africa until Great Britain took control of the region and introduced the pound and the shilling. The first locally issued South African pound appeared in 1910 and remained the official currency until 1961.

3. The SARB allows old currency banknotes to remain in circulation.

Even denominations that aren’t currently in circulation are still legal tender, no matter how old they are. For example, if you come across 2- or 5-rand banknotes, the central bank will exchange them for face value.

The same goes for the Big Five series from 1992-1994, even though the 2005 reissue of these banknotes includes additional security features.

4. The R 100 banknote features the Robben Island prison.

Nelson Mandela spent 18 years imprisoned on Robben Island before he became South Africa’s first president and “Father of the Nation.”

The reverse of the 100 rand banknote features an image of the prison, reminding anyone who holds it about this important chapter in South Africa’s history.

5. The rand takes its name from the landscape.

The name for South African money comes from the word “Witwatersrand.” Rand is the word for “ridge” in Dutch and Afrikaans, which translates to “white waters’ ridge.”

This is the name of the high escarpment on which Johannesburg sits, and it also happens to be the region from which the majority of South African gold comes.

6. The rand is legal tender throughout the Southern African Common Monetary Area.

South Africa isn’t the only place you can spend South African currency. You can also use the rand across Southern Africa in Eswatini, Lesotho, and Namibia. Each of the four countries issues its own version, but they all have the same value and are legal tender throughout the Southern African Common Monetary Area.

Previously, Botswana was part of this currency union, but it left in 1976 when it eliminated the rand and introduced the pula to gain more control over its finances.

How does foreign exchange impact the South African Rand?

The foreign exchange market plays a pivotal role in determining the rand value. Factors like trade with Chinese and European markets influence its standing in the global economy. Through the ISO system, the rand is easily traded on international platforms, ensuring smooth transactions in various currency exchanges.

How did apartheid historically affect the Rand?

The apartheid system brought significant economic and political shifts, impacting South Africa’s position on the world stage and, by extension, the rand’s performance against foreign currencies. As South Africa has evolved, so has the rand, adapting to its changing dynamics while honoring its rich history.

In what way do Visa and Mastercard facilitate Rand transactions?

Visa and Mastercard simplify accessing and spending the South African Rand, whether you’re a local enjoying global services or a visitor exploring this vibrant country. They bridge the gap between the rand and foreign currencies, making every transaction seamless.

What’s the relationship between the Rand and its neighboring currencies?

The rand’s influence extends beyond South Africa’s borders, serving as a Southern African Common Monetary Area staple. This includes close ties with the Namibian dollar and even as far as Zimbabwe and Zambia, facilitating a smoother foreign exchange process across these regions.

How do international trades with China and Europe affect the Rand?

South Africa’s trade relationships, particularly with China and Europe, directly impact the rand through the currency exchange rates. These interactions reflect the global economy’s dynamic nature and how interconnected South Africa is with the world.

More about South Africa

Portrait of mountains by the sea

South Africa is famous worldwide for its beautiful landscapes, from wine country to the Cape of Good Hope to Kruger National Park.

It also has three capital cities—one administrative, one judicial, and one legislative—and it fully encompasses an entirely separate country, the Kingdom of Lesotho, a landlocked enclave.

Using money in South Africa

If you’re heading to South Africa to explore the country or to visit friends and family, you’ll want to be able to access enough rand to buy things while you’re there. South Africa has an advanced banking economy, so you can access ATMs easily or use credit cards to make international purchases in most parts of the country.

However, international transactions may incur high conversion fees, so looking up the rand exchange rate before spending money in South Africa is important.

The rand’s value can change over time compared to the United States dollar (USD), the Australian dollar, the British pound sterling (GBP), and other world currencies. You can use an online money transfer app or currency converter to track real-time exchange rates.

For example, if you want to convert the U.S. dollar into rand, you can see how much 1 USD is worth in South African money.

Or, work backward by determining how many rands you need (such as 1,000 ZAR) and see how much that’s equivalent to in euro (EUR), GBP, or another global currency.