Rand gets its second facelift at age of 51

Mandela image follows wild animals and Jan van Riebeeck

The rand celebrated its 51st birthday on Valentine's Day this week, just three days after the announcement that the currency will undergo its second major change in appearance since it was launched in 1961.

At the announcement on Saturday last week that former president Nelson Mandela's image will replace the Big Five animals on banknotes, Reserve Bank governor Gill Marcus said banknotes were not only a medium of payment but were also pieces of craftsmanship that were a window on a country, its people, its heritage and its culture, and were often seen as second only to the national flag.

The history of South African currency is closely intertwined with the country's history.

Dutch and British currencies were used in the colonial days.

Rands and cents replaced the South African pound, which was linked to the British pound until shortly before South Africa became a republic in 1961. The first rand bank-notes bore the image of Jan van Riebeeck, the Dutch East India Company's first administrator of the Cape.

In 1992, with South Africa on its way to democracy, a redesign of banknotes was announced, with new features, such as the Big Five replacing Van Riebeeck.

News that Mandela will feature on the new banknotes came 22 years after his release from prison.

According to Marcus, international best practice dictates that security features should be upgraded or new banknotes with new designs and security features issued every six to eight years.

The last major upgrade of banknote security features was in 2005.

Marcus said the redesign of the new note series cost R2.5-million and took about nine months to complete.

But the Reserve Bank would not comment this week on how the process to redesign banknotes worked, why the process took so long and how much it cost to produce a banknote.

"The process of redesigning banknotes normally takes between 12 and 24 months," said the bank's head of strategy and communications Hlengani Mathebula.

"The governor of the Reserve Bank appoints a committee to manage the development of the new note series.

"Members of the committee are selected from different functional departments in the bank. The development processes are done in different stages with the involvement of external and internal stakeholders," said Mathebula.

The new notes will go into circulation before year's end and will gradually replace the current series.

While the Reserve Bank wants the change to happen as quickly as possible, there is no clear timeline for this.

Marcus said that it was difficult to set a timeline, with R103-billion worth of South African banknotes in circulation over Christmas and the currency being used not only in South Africa.

The rand's common monetary area includes South Africa, Namibia, Lesotho and Swaziland.

While these neighbouring countries have their own currencies, they are pegged to the rand, and in most cases the rand is accepted as legal tender.

In 2008 Zimbabwe suspended the use of its Zimbabwean dollar and it has since followed a multi-currency regime, which includes use of the US dollar, the South African rand and Botswana's pula.

Apart from the countries where the rand is officially accepted as legal tender, the currency is used unofficially in most Southern African countries, and even as far north as Tanzania and Kenya.