Iran's Largest Banknote in History Released: 10000000 Rials!

Caixin

Caixin, March 23 — Amid ongoing conflict in the Middle East, Iranian authorities are issuing new banknotes with a face value of 10 million rials, the highest denomination in the country’s history. Analysts point out that this move aims to control soaring inflation and meet the public’s demand for cash during the US-Iran conflict.

At current exchange rates, this 10 million rial banknote is worth only about $7 USD, or 53 RMB…

Iranian domestic banks have previously been targeted in US and Israeli airstrikes. Fearing electronic system failures, people queued at ATMs to withdraw cash, and many locations quickly ran out.

The newly issued pink banknote features the 9th-century Yazd Jameh Mosque on the front and the 2,500-year-old Bam Citadel on the back. It is now the largest circulating denomination in Iran—replacing the 5 million rial banknote introduced in early February.

The Central Bank of Iran stated that the issuance of this banknote aims to “ensure public access to cash,” and added that electronic systems—including debit cards, mobile banking, and online banking—will continue to be the main platforms for financial transactions.

However, despite the government’s assurances of continued cash supply after the outbreak of war, local banks are offering very limited cash withdrawals to customers. As the war enters its fourth week, the issuance of this new banknote is another sign of the severe blow to Iran’s economy.

The US and Israel have targeted infrastructure, including banks, further pressuring businesses already affected by ongoing bombings and the indefinite closure of Iranian airspace. With trade routes closed, import prices have also risen.

On March 11, a building belonging to Bank Sepah was hit by a missile. The bank serves Iran’s armed forces and the public, and this incident has heightened public concern. The bank announced last Wednesday that services had resumed, allowing customers to shop and use ATMs, with online banking services to be restored soon.

Rising Inflation

For years, US sanctions, declining oil revenues, and persistent high inflation have put enormous pressure on Iran’s economy, leading to a sharp devaluation of the rial. After Israel’s 12-day war ended in June last year, the rial depreciated by 40% within months, and economic stagnation triggered large-scale protests in Iran in January.

Before the US and Israel launched attacks on Iran on February 28, the rial exchange rate further depreciated to a record low of 1 USD = 1.66 million rials. However, as of last Friday, the rate had recovered to about 1.5 million rials.

According to Iran’s Statistical Center, the annual inflation rate reached 47.5% in the month ending February 19.

After the government removed foreign exchange subsidies for basic imports, inflation in food and beverages soared above 105%. In response, the government launched a food voucher program, providing 80 million Iranians with monthly credit to buy staples at designated stores.

Notably, in November last year, the Iranian government enacted a law to remove four zeros from the rial over five years to simplify transactions and reduce printing costs. On this new 10 million rial banknote, the last four zeros are faintly printed, with “1000” in bold. This design style, used on all new banknotes since 2019, aims to facilitate the transition.

Analysts note that after the war, the rial has strengthened against the dollar, due to decreased foreign trade, Iranians canceling travel abroad, and an increase in people selling foreign currency to meet urgent cash needs. An exchange broker in Tehran said, “Only those selling property or cars, or who don’t want to keep their money in rials, buy foreign currency. But on the other hand, supply has also decreased significantly. In this situation, only those in urgent need of cash are selling their foreign currency.”