
The South Korean won (
symbol
A symbol is a mark, Sign (semiotics), sign, or word that indicates, signifies, or is understood as representing an idea, physical object, object, or wikt:relationship, relationship. Symbols allow people to go beyond what is known or seen by cr ...
: ₩;
code
In communications and information processing, code is a system of rules to convert information—such as a letter, word, sound, image, or gesture—into another form, sometimes shortened or secret, for communication through a communicati ...
: KRW; ) is the official currency of
South Korea
South Korea, officially the Republic of Korea (ROK), is a country in East Asia. It constitutes the southern half of the Korea, Korean Peninsula and borders North Korea along the Korean Demilitarized Zone, with the Yellow Sea to the west and t ...
. 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 the
Bank of Korea, based in the capital city of
Seoul
Seoul, officially Seoul Special Metropolitan City, is the capital city, capital and largest city of South Korea. The broader Seoul Metropolitan Area, encompassing Seoul, Gyeonggi Province and Incheon, emerged as the world's List of cities b ...
.
Etymology
The old "won" was a
cognate
In historical linguistics, cognates or lexical cognates are sets of words that have been inherited in direct descent from an etymological ancestor in a common parent language.
Because language change can have radical effects on both the s ...
of the
Chinese yuan
The renminbi ( ; currency symbol, symbol: Yen and yuan sign, ¥; ISO 4217, ISO code: CNY; abbreviation: RMB), also known as the Chinese yuan, is the official currency of the China, People's Republic of China. The renminbi is issued by the Peop ...
, which was derived from the
Spanish-American silver dollar. It is derived from the
hanja
Hanja (; ), alternatively spelled Hancha, are Chinese characters used to write the Korean language. After characters were introduced to Korea to write Literary Chinese, they were adapted to write Korean as early as the Gojoseon period.
() ...
(, ), meaning "round", which describes the shape of the silver dollar.
The won was subdivided into 100 (), itself a cognate of the East Asian unit of weight
mace 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.
First South Korean won
History
The
Korean won,
Chinese yuan
The renminbi ( ; currency symbol, symbol: Yen and yuan sign, ¥; ISO 4217, ISO code: CNY; abbreviation: RMB), also known as the Chinese yuan, is the official currency of the China, People's Republic of China. The renminbi is issued by the Peop ...
and
Japanese yen
The is the official currency of Japan. It is the third-most traded currency in the foreign exchange market, after the United States dollar and the euro. It is also widely used as a third reserve currency after the US dollar and the euro.
Th ...
were all derived from the
Spanish-American silver dollar, a coin widely used for international trade between Asia and the Americas from the 16th to 19th centuries.
During the
colonial era under the Japanese (1910–45), the won was replaced by the
Korean yen which was
at par with the Japanese yen.
After
World War II
World War II or the Second World War (1 September 1939 – 2 September 1945) was a World war, global conflict between two coalitions: the Allies of World War II, Allies and the Axis powers. World War II by country, Nearly all of the wo ...
ended in 1945,
Korea was divided, resulting in two separate currencies, both called won, for the South and the
North
North is one of the four compass points or cardinal directions. It is the opposite of south and is perpendicular to east and west. ''North'' is a noun, adjective, or adverb indicating Direction (geometry), direction or geography.
Etymology
T ...
. 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 initially had
a fixed exchange rate to the
U.S. dollar at a rate of 15 won to 1 dollar. A series of
devaluation
In macroeconomics and modern monetary policy, a devaluation is an official lowering of the value of a country's currency within a fixed exchange-rate system, in which a monetary authority formally sets a lower exchange rate of the national curre ...
s followed, the later ones, in part, due to the
Korean War
The Korean War (25 June 1950 – 27 July 1953) was an armed conflict on the Korean Peninsula fought between North Korea (Democratic People's Republic of Korea; DPRK) and South Korea (Republic of Korea; ROK) and their allies. North Korea was s ...
(1950–53). 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.
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 June 12, 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
ISO 4217 is a standard published by the International Organization for Standardization (ISO) that defines alpha codes and numeric codes for the representation of currencies and provides information about the relationships between individ ...
code is KRW. At the reintroduction of the won in 1962, its value was pegged at 125 won = . The following pegs operated between 1962 and 1980:
On February 27, 1980, efforts were initiated to lead to a
floating exchange rate
In macroeconomics and economic policy, a floating exchange rate (also known as a fluctuating or flexible exchange rate) is a type of exchange rate regime in which a currency's value is allowed to fluctuate in response to foreign exchange market ...
. The won was finally allowed to float on December 24, 1997, when an agreement was signed with the
International Monetary Fund
The International Monetary Fund (IMF) is a major financial agency of the United Nations, and an international financial institution funded by 191 member countries, with headquarters in Washington, D.C. It is regarded as the global lender of las ...
. Shortly after, the won was devalued to almost half of its value, as part of the
1997 Asian financial crisis
The 1997 Asian financial crisis gripped much of East Asia, East and Southeast Asia during the late 1990s. The crisis began in Thailand in July 1997 before spreading to several other countries with a ripple effect, raising fears of a worldwide eco ...
.
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
Brass is an alloy of copper and zinc, in proportions which can be varied to achieve different colours and mechanical, electrical, acoustic and chemical properties, but copper typically has the larger proportion, generally copper and zinc. I ...
and the 5 and 10 won in
bronze
Bronze is an alloy consisting primarily of copper, commonly with about 12–12.5% tin and often with the addition of other metals (including aluminium, manganese, nickel, or zinc) and sometimes non-metals (such as phosphorus) or metalloid ...
. These were the first South Korean coins to display the date in the
Gregorian calendar
The Gregorian calendar is the calendar used in most parts of the world. It went into effect in October 1582 following the papal bull issued by Pope Gregory XIII, which introduced it as a modification of, and replacement for, the Julian cale ...
, earlier coins having used the
Korean calendar
Throughout its many years of history, various calendar systems have been used in Korea. Many of them were adopted from the Lunar calendar, lunar Chinese calendar system, with modifications occasionally made to accommodate Korea's geographic locat ...
. 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
aluminium
Aluminium (or aluminum in North American English) is a chemical element; it has chemical symbol, symbol Al and atomic number 13. It has a density lower than that of other common metals, about one-third that of steel. Aluminium has ...
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.
In 1982, with inflation and the increasing popularity of
vending machine
A vending machine is an automated machine that dispenses items such as snacks, beverages, cigarettes, and lottery tickets to consumers after cash, a credit card, or other forms of payment are inserted into the machine or payment is otherwise m ...
s, 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 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. The new coin is made of copper-coated aluminium with a reduced diameter of , and a weight of . 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
rarely 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.
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.
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 won issued in 1983 is series II () 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 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
Intaglio ( ; ) is the family of printing and printmaking techniques in which the image is incised into a surface and the incised line or sunken area holds the ink. It is the direct opposite of a relief print where the parts of the matrix that m ...
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
A watermark is an identifying image or pattern in paper that appears as various shades of lightness/darkness when viewed by transmitted light (or when viewed by reflected light, atop a dark background), caused by thickness or density variations i ...
,
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.
[
]
New security features
In 2006, it became a major concern that the South Korean won banknotes were being counterfeited. 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. Also of controversy was the appearance of Kim Ku on the note, who is controversial among the South Korean right.
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 in euro
The euro (currency symbol, symbol: euro sign, €; ISO 4217, currency code: EUR) is the official currency of 20 of the Member state of the European Union, member states of the European Union. This group of states is officially known as the ...
s, pounds, Canadian dollar
The Canadian dollar (currency symbol, symbol: $; ISO 4217, code: CAD; ) is the currency of Canada. It is abbreviated with the dollar sign $. There is no standard disambiguating form, but the abbreviations Can$, CA$ and C$ are frequently used f ...
s, and Japanese yen
The is the official currency of Japan. It is the third-most traded currency in the foreign exchange market, after the United States dollar and the euro. It is also widely used as a third reserve currency after the US dollar and the euro.
Th ...
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
A watermark is an identifying image or pattern in paper that appears as various shades of lightness/darkness when viewed by transmitted light (or when viewed by reflected light, atop a dark background), caused by thickness or density variations i ...
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 " Bank of Korea" and its corresponding 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, such as to Europe and North America.
Future
Coinless trials
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. As of 2019, however, public participation in this program has decreased.
Redenomination proposals
There have been recurring proposals in the South Korean National Assembly to redenominate the won by introducing a new won or new unit, equal to 1,000 old won, and worth nearly one U.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.
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 the KOMSCO, a government-owned corporation, under the guidance of the Bank of Korea.
After the new banknotes and coins are 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
Ranking
See also
References
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External links
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New South Korean won banknotes
information page of BOK's new notes
Pronunciation of Won at freedictionary.com
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1962 in South Korea
1962 establishments in South Korea
Currencies of South Korea
Government of South Korea
Cultural depictions of Yi Sun-sin
Currencies introduced in 1962
Currencies of Asia
Circulating currencies
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