Iran Issues Largest Denomination Banknote Amid Inflation and Cash Shortages

Tehran. Iran has issued the largest denomination banknote in its history to manage rising inflation and cash shortages. Iran has released a new 10 million Rial note. Banks began distributing the new notes this week. This is worth approximately 7 US dollars.

Amid ongoing conflict with the US and Israel, uncertainty among the general public regarding the financial system has increased, leading people to queue up outside banks and ATMs to withdraw cash. In some places, ATMs are emptying quickly, while banks are providing customers with limited amounts of money.

Eighty-year-old Maryam, a Tehran resident, shared her experience, saying that although she initially received only 10 million Rials after waiting in a long line, she received 30 million Rials upon request. According to her, while the amount is only enough to get by for a few days if the card system shuts down, keeping cash safe has become essential.

The new pink note features an image of the historic Jameh Mosque of Yazd on the front, and a picture of the 2,500-year-old Bam Citadel on the back. This surpasses the previously circulated 5 million Rial note to take the place of the highest denomination note. Iran's central bank claims this move was taken to ensure public access to cash.

It has also been stated that debit cards, mobile banking, and internet banking systems will continue to be used as the main means of transaction. However, in practice, banks are distributing only limited cash, which is further increasing public anxiety.

As the war enters its fourth week, the Iranian economy appears to be under further pressure. Trade, service, and supply systems have been affected after the US and Israel attacked banks and other infrastructure. Public confidence in the financial system further weakened after a missile strike on the Bank Sepah building on March 11, although the bank has announced that some services have resumed operations. Iran's economy was already weak due to US sanctions, declining oil revenue, high inflation, and structural corruption.

In recent years, the public has been struggling as the value of the Rial has rapidly declined. The currency had weakened by about 40 percent after the war in the past year, and the exchange rate, which had fallen to about 1,660,000 Rials per dollar before the recent conflict began, has slightly improved to around 1,500,000 Rials currently.