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Dear Editor,
The Central Bank of Iran is now issuing checks for 500,000 and
1,000,000 rials, which are circulating as banknotes; but should
they be considered as banknotes? The highest denomination
“banknote” now circulating in Iran is the 50,000-rial note
(P.149), which has two signature varieties. Based on today’s
exchange rate this note is worth about USD5.00.
Despite the demand for higher denomination banknotes the
Central Bank of Iran has refused to print banknotes in higher
values. This task was left to local banks, Bank Meli, Bank Saderat,
Bank Melat, etcetera, to print “Bank Cheques”, which were
valid for circulation but could only be cashed at issuing banks.
Depending on the bank the denominations were anywhere from
100,000 rials to 2,500,000 rials.
This created not only confusion, but restrictions. While
merchants accept any “Bank-Cheques”, each utility bill has to
be paid to a certain bank. So, if you had Bank Saderat “Bank-
Cheques” in your wallet, and you wanted to pay your water bill,
which has to be paid at Bank Melat’s branches, you could not use
Bank Saderat’s “Bank-Cheques”.
Eventually, the Central Bank started issuing high value
banknotes; however, to avoid acknowledging inflation and
calling them “banknotes”, they introduced the new notes as “Iran
Cheques”. These notes are now circulating all over Iran and all
the local banks have been asked to withdraw their local “Bank
Cheques”. The Iran Cheques are not used once, like a personal
or bank check, but circulate as currency without endorsement
along with banknotes of smaller denominations. The new “notes”
are vended from ATM machines and are printed on both sides
(unlike most checks).
The 500,000- and 1,000,000-rial Iran Cheques illustrated here
are signed by Mazaheri (signature #29). They have all the security
features of a banknote, such as a security thread, which carries the
text “The Central Bank of the Islamic Republic of Iran” in Persian,
and a watermark, which is Ferdowsi the famous Persian poet.
(Hakīm Abu’l-Qāsim Firdawsī Tūsī (935–1020), more commonly
transliterated as Ferdowsi, was a Persian poet and author of the
Shāhnāmeh, the epic Persian poem.) Does the introduction of this
watermark augur the end of the Khomeni watermark?
The Central Bank’s “Iran Cheques” are printed in Iran where,
for more than 15 years, Iran has been printing their banknotes on
paper manufactured in Germany. (A new facility in Babol in Iran
will soon produce security paper for Iran’s banknotes.)
Currently, branch banks receive the new notes from the
Central Bank and stamp them on the back with the branch
name and the date before placing the notes into circulation. This
measure is probably for control or preventing counterfeiting; but
I suspect this practice is temporary and will soon be abolished.
On two previous occasions, once in 1952 and again in 1980,
Bank Meli was forced to issue Emergency Circulating Checks (Pick
70ABC and 126A). Those were bearer checks, which were: printed
on one side, printed in Persian with no English text, valid only within
Iran, and circulated only for a short time (in the case of P.126A
maybe only a month). What the Central Bank has now issued should
be considered as banknotes, even though the Central Bank, due to
political, financial and social reasons, calls them “Cheques”.
Respectfully,
Armen Hovsepian LM-106
IBNS Journal 48.2 7