The West African CFA franc is the currency used by a number of West African countries such as Benin, Burkina Faso, Mali, Senegal and Togo to name a few.
In this blog we’ll be exploring everything you need to know about the West African CFA franc.
Below you’ll learn about:
- The importance of the CFA to West African Immigrants in the United States
- The West African CFA franc
- How is the West African CFA franc recognized?
- The history of the West African CFA franc
- The West African CFA franc today
- Exchange rates
- How can I send money to West African countries?
The importance of the CFA to West African Immigrants in the United States
The United States is home to many West African immigrants for whom the West African CFA franc remains important. A large section of African immigrants from countries like Mali, Niger, Senegal or Togo who are in the US across such states as Texas, New York, California, Maryland, New Jersey, Massachusetts and Virginia send money home in the form of remittances to support their family, friends and communities.
As the population of West African immigrants to the US continues to grow, citizens of countries like Burkina Faso and the Ivory Coast will have to be more aware of the way the US dollar and the West African CFA franc interact. Recent studies have shown that African immigrants to the U.S. are more likely to settle in the South (39%) or the Northeast (25%), than in the Midwest (18%) or West (17%). And across these states West Africans have created strong communities that are still in some way influenced by the strength of CFA franc.
The West African CFA franc
The West African CFA franc is a fascinating currency that has an interesting history. The story of the West African CFA franc is linked to the French colonization of parts of Africa but is also linked to the independence of the West African nations achieved during the twentieth century. CFA is an acronym which stands for Communauté Financière Africaine (African Financial Community).
So, how many African countries use the West African CFA franc?
There are eight independent African countries that use the West African CFA franc: Burkina Faso, Ivory Coast, Mali, Niger, Senegal, Togo, Guinea-Bissau and Benin. The currency serves a huge combined population of 105 million people and is an essential diplomatic link between West African countries today.
The currency is issued by the Central Bank of West African States and has a couple of straightforward nicknames like “franc”, and “céfa”. The West African CFA franc is also currently pegged to the Euro.
How is the West African CFA franc recognized?
The international currency code for the West African CFA franc is XOF, and it is also recognized by the symbol: CFA. In French it can be simply referred to as franc CFA. The subunit of the West African CFA franc is the centime, with 1 CFA comprising one hundred centimes.
The coin denominations of the West African CFA franc include 1, 5, 10, 25, 50, 100, 200, 250, 500 francs CFA. While the banknote denominations currently in circulation include the 500, 1,000, 2,000, 5,000 and 10,000 francs CFA. The notes are easily recognized by their distinct and vibrant colors ranging from deep purple and a rich red to bright greens and blues.
Now you know who uses the CFA franc and how it is recognized, let's take a look at the history of the West African CFA franc (XOF) in more detail.
The history of the West African CFA franc
The history of the West African CFA franc begins in 1945 when the CFA franc was created and introduced to French colonies in Africa. In West Africa the West African CFA franc was used and in Central African countries like Chad and Gabon the Central African CFA franc was used.
When it was created the West African CFA franc was pegged to the French franc. This meant that in 1945 1 CFA franc was worth 1.70 French francs. The West African CFA franc has since become devalued with the creation of the new French franc and the subsequent introduction of the euro.
The countries that use the West African CFA franc have also changed over time. Countries like Mauritania used the West African CFA franc when it was created but have since adopted their own currency (the ouguiya). On the other hand, countries like Guinea-Bissau, a former Portuguese colony that used the Guinea-Bissau peso, adopted the West African CFA franc in 1997.
For many years the West African CFA franc was pegged to the French franc with 1 FRF = 100 XOF. When the euro was introduced the exchange rate ratio stayed the same.
While the history of the West African CFA franc is important, it also helps to know what the currency looks like today.
The West African CFA franc today
The West African CFA Franc continues to be a vital link between several West African nations. The economies of smaller countries like Benin, Togo and Burkina Faso benefit from being able to share a relatively stable currency with their neighbours. Each country is in some way dependent on the other for financial success and this helps to build recognition for the currency on a global stage.
The current series of banknotes, issued in 2003, feature illustrations of West African culture, animals and food. For example, the 1000 francs CFA notes depict symbols of West African symbols of education and health on the front and illustrations of camels on the reverse side. The 10,000 francs CFA note features images of telecommunications on the front and African birds on the reverse side.
So, what changes lie ahead for the West African CFA franc?
One significant change concerns the name. In 2019, proposals were made to change the name of the West African CFA franc to the “Eco”. This change would also result in France’s roles in the currency being reduced. Although many deem this change to be mainly symbolic in nature it is an attempt to prevent the appearance that France still has influence in the region.
So, we know what the West African CFA franc looks like today, but what about its value? Let’s look at some exchange rates which will help us understand the international value of the West African CFA franc.
Exchange rates
An exchange rate is about comparing the value of one currency to another. For example, on average in 2021, the exchange rate of the West African CFA franc to the US dollar has been 1 USD to 547 XOF. Similarly, during the whole of 2020 the average exchange rate was 1 USD to 575 XOF.
During the first half of 2021, the average exchange rate of the Euro to the West African CFA franc was 1 EUR to 655 XOF. According to Exchangerates.org, the average exchange rate of the West African CFA franc to the Indian rupee during the first half of 2021 was 1 INR to 7.4 XOF.
These exchange rates are useful to know if you intend to travel to, or send money to, West Africa. They can also give you an idea of the strength of the economy of these particular West African nations compared to other countries around the world.
How can I send money to West African countries?
Now you know a bit more about how the West African CFA franc works on a global scale, you may be considering sending money back to family, friends or businesses in West Africa.
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