TheSouth Korean won, sometimes known as theRepublic of Korea won[5] (symbol:₩;code:KRW;Korean: 대한민국 원), is the official currency ofSouth Korea. A single won is divided into 100 jeon, the monetary subunit. The jeon is no longer used for everyday transactions, and it appears only in foreign exchange rates. The currency is issued by theBank of Korea, based in the capital city ofSeoul. The South Korean won was first issued in 1949, then was replaced by theSouth Korean hwan between 1953 and 1962, before the adoption of the current South Korean won in 1962.[6]
The won was subdivided into 100jeon (Korean: 전;Hanja: 錢;MR: chŏn), itself a cognate of the East Asian unit of weightmace and synonymous with money in general. The current won (1962 to present) is written in hangul only and does not officially have any hanja associated with it.[3][4]
AfterWorld War II ended in 1945,Korea was divided, resulting in two separate currencies, both called won, for the South and theNorth. Both theSouthern won and theNorthern won replaced the yen at par. The first South Korean won was subdivided into 100jeon.
In 1946, theBank of Joseon introduced 10 and 100 won notes. These were followed in 1949 by 5 and 1,000 won notes.
A new central bank, theBank of Korea, was established on June 12, 1950,[8] 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 inEnglish in won, were, in fact, the first issues of thehwan.
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. ItsISO 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:
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 inbrass and the 5 and 10 won inbronze. These were the first South Korean coins to display the date in theGregorian calendar, earlier coins having used theKorean calendar. The 10 and 50 hwan coins were demonetized on March 22, 1975.[10]
In 1968, as the intrinsic value of the brass 1 won coin far surpassed its face value, newaluminium 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 coins in 1972.[10]
These images are to scale at 2.5 pixels per millimetre. For table standards, see thecoin specification table.
In 1982, with inflation and the increasing popularity ofvending 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.[10]
These images are to scale at 2.5 pixels per millimetre. For table standards, see thecoin specification table.
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 cost of production, 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.[15] The new coin is made of copper-coated aluminium with a reduced diameter of 18 millimetres (0.71 in), and a weight of 1.22 grams (0.043 oz). Its visual design is the same as the old coin.[16] The new coin was issued on December 18, 2006.[17][18]
The 1 and 5 won coins arerarely in circulation since 1992, 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.[19]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.[20]
TheBank 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 withKorean letters used in alphabetical order, e.g.가, 나, 다, 라, 마, 바, 사. Therefore, 1,000 won issued in 1983 is series II (나) because it is the second design of all 1,000 won 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 theUK byThomas De La Rue. The jeon notes together with a second issue of 10 and 100 won notes were printed domestically by theKorea Minting and Security Printing Corporation.
In 1965, 100 won notes (series III) were printed usingintaglio 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 usinglithoprinting.[10]
These images are to scale at 0.7 pixel per millimetre (18 pixel per inch). For table standards, see thebanknote specification table.
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.[10] 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, includingwatermark,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.[21] 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.
These images are to scale at 0.7 pixel per millimetre (18 pixel per inch). For table standards, see thebanknote specification table.
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.[10]
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.[21][22][23]
In 2006, it became a major concern that the South Korean won banknotes were beingcounterfeited. 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 ofShin Saimdang, a prominent 16th-century artist, calligrapher, and mother of Korean scholarYulgok, 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.[25] 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.[26]
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 theDaedongyeojido map, and not including the disputedDokdo islands.[27][28][29][30] Also of controversy was the appearance ofKim Ku on the note, who is controversial among the South Korean right.[31]
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, the 2,000 won note 10 and the 1,000 won note 19. Many modern security features that can be also found ineuros,pounds,Canadian dollars, andJapanese 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 of the note with small lettering "한국은행 Bank of Korea" and its corresponding denomination
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, such as to Europe and North America.[32]
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 by depositing change into prepaid cards.[35] As of 2019, however, public participation in this program has decreased.[36]
There have been recurring proposals in theSouth Korean National Assembly to redenominate the won by introducing a new won or new unit, equal to 1,000 old won, and worth nearly oneU.S. dollar. While proponents cite a more valuable currency unit better projects the strength of the nation's economy, a majority remain opposed to the idea. Reasons cited are: economic harm if done immediately, no issues on public confidence in the won and its inflation rate, limited cost savings, and the presence of more urgent economic issues.[37]
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 the KOMSCO, a government-owned corporation, under the guidance of the Bank of Korea.After the new banknotes and coins areminted, 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, aroundSeollal andChuseok, 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.
^The total sum is 200% because each currency trade is counted twice: once for the currency being bought and once for the currency being sold. The percentages above represent the proportion of all trades involving a given currency, regardless of which side of the transaction it is on.
^Kawai, Masahiro; Pak, Yŏng-chʻŏl; Wyplosz, Charles (2015).Monetary and Financial Cooperation in East Asia: The State of Affairs After the Global and European Crises. Oxford:Oxford University Press.ISBN978-0-19-871415-6.
^Linzmayer, Owen (2012). "South Korea".The Banknote Book. San Francisco, CA: banknotenews.com.Archived from the original on August 29, 2012. RetrievedAugust 17, 2012.
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