Large-Denomination Bills Considered

Talk of introducing 50 thousand won and 100 thousand won bills has gained momentum recently.

This is because the Ministry of Finance and Economy, which had been strongly negative about issuing high denomination bills, has recently changed its standing and said it would look over the issue if the National Assembly is in favor of it.

Many think that because the Korean economy has grown too big that it should issue higher denomination bills than ten thousand won bills. Some think, however, that higher denomination bills would make kickback to government officials easier.

The Ministry of Finance and Economy will not refuse higher denomination bills-

Deputy Minister of Finance and Economy Lim Young-rok said on Thursday during a regular briefing session that the ministry is considering the introduction of higher denomination bills, partly because it is currently being discussed in the National Assembly. He went on to say that the ministry would take the necessary measures with other ministries and institutions when the National Assembly settles the matter.

The Bank of Korea, which has long argued for the higher denomination bills, is satisfied with the shift in stance of the Ministry of Finance and Economy.

Chung Nam-seok, the head of note-issuing Team at the Bank of Korea, said, “We asked companies that make new ATM machines for the new 10 thousand won and one thousand won bills that come out next year on January 22 to anticipate the introduction of higher denomination bills. The ATM machines, with a few minor touches, will be compatible with the higher denomination bills.”

The ruling party and the opposition party recently reached a consensus on the introduction of higher denomination bills. It will be many years before the bills make their debut. It will take more than two years for the Bank of Korea to decide which characters will be portrayed on the bills, to choose the design and color of the bills, and to print out the bills.

Why higher denomination bills?

The ten thousand won bills were first issued in 1973. Since then, the Korean economy has grown by 140 times and the consumer price index has reached 12 times the previous level.

According to the Bank of Korea, the average value of the highest denomination bills of 29 of the 30 Organization for Economic Co-operation and Development (OECD) countries excluding Korea is at about 350 thousand won. Of the 212 countries of the world, only 29 countries including Somalia, Mongolia, and Sudan have highest denomination bills that have lower face values than Korea’s won.

100,000 won checks, of which about one billion are printed each year, return to the bank after being distributed for an average duration of 10 days and then are discarded. The Bank of Korea argues higher denomination bills are needed because it costs about 400 billion won yearly to print out the checks and to maintain them.

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