The won (; Korean: ?, Korean pronunciation: [w?n]; symbol: ?; code: KRW) or the Korean Republic Won is the currency of South Korea. A single won is divided into 100 jeon, the monetary subunit. The jeon is no longer used for everyday transactions, and appears only in foreign exchange rates. The won is issued by the Bank of Korea, based in the capital city of Seoul. The official currency of North Korea, issued by the Central Bank of the Democratic People's Republic of Korea which is based in its capital city, Pyongyang, is divided into the same number of units, and is known as the North Korean won.
Video South Korean won
Etymology
The old "won" was a cognate of the Chinese yuan and Japanese yen. It is derived from the hanja ? (?), meaning "currency" or "coin." The won was subdivided into 100 jeon (Hangul: ?; Hanja: ?; RR: jeon; MR: ch?n), itself a cognate of the Chinese character ? (qián) which means "money" and also used as a unit of money in ancient times. The current won (1962 to present) is written in hangul only.
Maps South Korean won
First South Korean won
History
During the Colonial era, the won was replaced at par by the yen, made up of the Korean yen.
In 1945 after World War II, Korea became divided, resulting in two separate currencies, both called won, for the South and the North. Both the Southern won and the Northern won replaced the yen at par. The first South Korean won was subdivided into 100 jeon.
The South Korean won was initially pegged to the U.S. dollar at a rate of 15 won = 1 dollar. A series of devaluations followed, the later ones in part due to the Korean War. The pegs were:
The first South Korean won was replaced by the hwan on February 15, 1953 at a rate of 1 hwan = 100 won. Republic of Korea Banknotes 5th Edition
Banknotes
In 1946, the Bank of Joseon introduced 10- and 100-won notes. These were followed in 1949 by 5- and 1,000-won notes.
A new central bank, the Bank of Korea, was established on 12 June 1950, and assumed the duties of Bank of Joseon. Notes were introduced (some dated 1949) in denominations of 5, 10 and 50 jeon, and 100 and 1,000 won. The 500-won notes were introduced in 1952. In 1953, a series of banknotes was issued which, although it gave the denominations in English in won, were, in fact, the first issues of the hwan.
Second South Korean won
History
The won was reintroduced on June 10, 1962, at a rate of 1 won = 10 hwan. It became the sole legal tender on March 22, 1975, with the withdrawal of the last circulating hwan coins. Its ISO 4217 code is KRW. At the reintroduction of the won in 1962, its value was pegged at 125 won = $US 1. The following pegs operated between 1962 and 1980:
On February 27, 1980, efforts were initiated to lead to a floating exchange rate. The won was finally allowed to float on December 24, 1997, when an agreement was signed with the International Monetary Fund. Shortly after, the won was devalued to almost half of its value, as part of the East Asian financial crisis.
Coins
Until 1966, 10- and 50-hwan coins, revalued as 1 and 5 won, were the only coins in circulation. New coins, denominated in won, were introduced by the Bank of Korea on August 16, 1966, in denominations of 1, 5 and 10 won, with the 1 won struck in brass and the 5 and 10 won in bronze. These were the first South Korean coins to display the date in the common era, earlier coins having used the Korean calendar. The 10- and 50-hwan coins were demonetized on March 22, 1975.
In 1968, as the intrinsic value of the brass 1-won coin far surpassed its face value, new aluminum 1-won coins were issued to replace them. As an attempt to further reduce currency production costs, new 5- and 10-won coins were issued in 1970, struck in brass. Cupronickel 100-won coins were also introduced that year, followed by cupronickel 50 won in 1972.
In 1982, with inflation and the increasing popularity of vending machines, 500-won coins were introduced on June 12, 1982. In January 1983, with the purpose of standardizing the coinage, a new series of 1-, 5-, 10-, 50-, and 100-won coins was issued, using the same layout as the 500-won coins, but conserving the coins old themes.
The Bank of Korea announced in early 2006 its intention to redesign the 10-won coin by the end of that year. With the increasing manufacturing price, then at 38 won per 10-won coin, and rumors that some people had been melting the coins to make jewelry, the redesign was needed to make the coin more cost-effective to produce. The new coin is made of copper-coated aluminium with a reduced diameter of 18 mm, and a weight of 1.22 g. Its visual design is the same as the old coin. The new coin was issued on December 18, 2006.
The 1- and 5-won coins are difficult to find in circulation today, and prices of consumer goods are rounded to the nearest 10 won. However, they are still in production, minting limited amounts of these two coins every year, for the Bank of Korea's annual mint sets. In 1998, the production costs per coin were: 10-won coins each cost 35 won to produce, 100-won coins cost 58 won, and 500 won coins cost 77 won.
The 100-won coins have exactly the same shape as the U.S. quarter, the only difference is the composition, with the 100-won coin struck in cupronickel rather than the U.S. quarter's cupronickel-clad composition.
Banknotes
The Bank of Korea designates banknote and coin series in a unique way. Instead of putting those of similar design and issue dates in the same series, it assigns series number X to the Xth design of a given denomination. The series numbers are expressed with Korean letters used in alphabetical order, e.g. ?, ?, ?, ?, ?, ?, ?. Therefore, ?1,000 issued in 1983 is series II (?) because it is the second design of all ?1,000 designs since the introduction of the South Korean won in 1962.
In 1962, 10- and 50-jeon, 1-, 5-, 10-, 50-, 100- and 500-won notes were introduced by the Bank of Korea. The first issue of 1-, 5-, 10-, 50-, 100- and 500-won notes was printed in the UK by Thomas De La Rue. The jeon notes together with a second issue of 10- and 100-won notes were printed domestically by the Korea Minting and Security Printing Corporation.
In 1965, 100-won notes (series III) were printed using intaglio printing techniques, for the first time on domestically printed notes, to reduce counterfeiting. Replacements for the British 500-won notes followed in 1966, also using intaglio printing, and for the 50-won notes in 1969 using lithoprinting.
With the economic development from the 1960s, the value of the 500-won notes fell, resulting in a greater use of cashier's checks with higher fixed denominations as means of payment, as well as an increased use of counterfeited ones. In 1970, the 100-won notes were replaced by coins, with the same happening to the 50-won notes in 1972.
Higher-denomination notes of 5,000 and 10,000 won were introduced in 1972 and 1973, respectively. The notes incorporated new security features, including watermark, security thread, and ultraviolet response fibres, and were intaglio printed. The release of 10,000-won notes was planned to be at the same time as the 5,000-won notes, but problems with the main theme delayed it by a year. Newly designed 500-won notes were also released in 1973, and the need for a medium denomination resulted in the introduction of 1,000-won notes in 1975.
In 1982, the 500-won note was replaced by a coin. The following year, as part of its policy of rationalizing the currency system, the Bank of Korea issued a new set of notes, as well as a new set of coins. Some of the notes' most notable features were distinguishable marks for the blind under the watermark and the addition of machine-readable language in preparation for mechanization of cash handling. They were also printed on better-quality cotton pulp to reduce the production costs by extending their circulation life.
To cope with the deregulation of imports of color printers and the increasing use of computers and scanners, modified 5,000- and 10,000-won notes were released between 1994 and 2002 with various new security features, which included color-shifting ink, microprint, segmented metal thread, moiré, and EURion constellation. The latest version of the 5,000- and 10,000-won notes are easily identifiable by the copyright information inscribed under the watermark: "© ????" and year of issue on the obverse, "© The Bank of Korea" and year of issue on the reverse.
The plates for the 5,000-won notes were produced in Japan, while the ones for the 1,000- and 10,000-won notes were produced by the Korea Minting and Security Printing Corporation. They were all printed in intaglio.
With the release of a new set of notes, no plan has yet been made to withdraw these notes from circulation.
New series
In 2006, it became a major concern that the Korean won banknotes were being counterfeited/forged. Notably, around 50% of 5,000-won notes (worth about US$5) were confiscated as counterfeit. This led the government to issue a new series of banknotes, with the 5,000-won note being the first one to be redesigned. Later in 2007, the 1,000- and 10,000-won notes were introduced.
On June 23, 2009, the Bank of Korea released the 50,000-won note. The obverse bears a portrait of Shin Saimdang, a prominent 16th-century artist, calligrapher, and mother of Korean scholar Yulgok, also known as Yi I, who is on the 5,000-won note. This note is the first Korean banknote to feature the portrait of a woman. The release of the 50,000-won note stirred some controversy among shop owners and those with visual impairments due to its similarity in color and numerical denomination with the 5,000-won note.
New 100,000-won notes were also announced, but their release was later cancelled due to the controversy over the banknote's planned image, featuring the Daedongyeojido map, and not including the disputed Dokdo islands.
The banknotes include over 10 security features in each denomination. The 50,000-won note has 22 security features, the 10,000-won note 21, the 5,000-won note 17, and the 1,000-won note 19. Many modern security features that can be also found in euros, pounds, Canadian dollars, and Japanese yen are included in the banknotes. Some security features inserted in won notes are:
- Holograms with three-dimensional images that change colors within the metallic foil on the obverse side of the notes (except ?1,000)
- Watermark portraits of the effigy of the note are visible when held to the light in the white section of the note.
- Intaglio printing on words and the effigy give off a raised feeling, different from ordinary paper
- Security thread in the right side of the obverse side with small lettering "???? Bank of Korea" and the denomination
- Color-shifting ink on the value number at the back of the note:
For the first time in the world, KOMSCO, the Korean mint, inserted a new substance in the notes to detect counterfeits. This technique is being exported to Europe, North America, etc.
Future of the South Korean won
As the South Korean economy is evolving through the use of electronic payments, coins of the South Korean won are becoming less used by consumers. The Bank of Korea began a trial which would result in the total cessation of the production of coins of the South Korean won.
Currency production
The Bank of Korea is the only institution in South Korea with the right to print banknotes and mint coins. The banknotes and coins are printed at KOMSCO, a government-owned corporation, under the guidance of the Bank of Korea. After the new banknotes and coins are printed/minted, they are bundled or rolled and shipped to the headquarters of the Bank of Korea. When delivered, they are deposited inside the bank's vault, ready to be distributed to commercial banks when requested. Every year, around Seollal and Chuseok, two major Korean holidays, the Bank of Korea distributes large amounts of its currency to most of the commercial banks in South Korea, which are then given to their customers upon request.
Current exchange rates
See also
References
External links
- "BOK Announces Smaller Banknotes". The Chosun Ilbo. 2005-07-21. Archived from the original on 2006-10-26. Retrieved 2006-10-17.
- "New W5,000 Ready for Release on Jan. 2". The Chosun Ilbo. 2005-12-13. Archived from the original on 2006-10-26. Retrieved 2006-10-17.
- "New W1,000 Note Unveiled". The Chosun Ilbo. 2006-01-17. Archived from the original on 2006-10-26. Retrieved 2006-10-17.
- "Dollar Plummets to Pre-Crisis Level Against Won". The Chosun Ilbo. 2006-01-25. Archived from the original on 2006-10-26. Retrieved 2006-10-17.
- "New W5,000 Bills Forgery- but not Water-Proof". The Chosun Ilbo. 2006-01-25. Archived from the original on 2006-10-26. Retrieved 2006-10-17.
- "New W10,000 Note Unveiled". The Chosun Ilbo. 2006-05-18. Archived from the original on 2006-07-09. Retrieved 2006-10-17.
- New South Korean won banknotes, information page of BOK's new notes
- Pronunciation of Won at freedictionary.com
Source of article : Wikipedia
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