The official currency of South Africa is the rand. The evolution of the South African currency from the pound to the rand over the past hundred years is fascinating and complex.
Are you curious why the rand is called the rand? Do you know whether the South African currency is strong? What is the future of the South African rand?
If youre asking these kinds of questions youve come to the right place!
When sending money internationally it is helpful to understand how different currencies relate.
In this blog well give an overview of the rand, learn about its history, the impact the currency has had on the South African economy and briefly touch on some of the most important exchange rates relating to the South African rand.
An overview of South Africas currency
1961 was the first year of the rand in South Africa. The word rand is derived from the Witwatersrand which is a ridge in Johannesburg where a substantial amount of South Africas gold deposits can be found.
In 2021, the rand is one of the strongest currencies in Africa and is continuing to strengthen on the back of a sustained economic rebound.
Rand is also used frequently in other African nations. The South African rand is also used in Lesotho, Namibia and Eswatini - countries in the South of Africa that are part of the Common Monetary Area. All these countries have their own currency. However, because of the comparative strength of the South African economy, the rand is widely accepted as a substitute for them to this day.
Printed on the seventh and most recent series of banknotes are portraits of Nelson Mandela. His portrait features on one side of every note and on the reverse side there are different depictions of young Mandela. On the 10 rand note, the reverse side features young Mandela and his birthplace of Mvezo, on the 20 rand the reverse side features young Mandela and his home in Soweto. This trend is repeated for the large denominations. Featured on the reverse side of the 50 rand note is young Mandela and the site of his capture near Howick, on the blue 100 rand note you can find Mandela and his place of imprisonment at Robben Island. Finally, on the orange 200 rand note you will find young Mandela and his statue at the Union Buildings.
The language of the currency, and the languages depicted on coins and notes varies. On every coin and note there is English but a variety of South African languages including Afrikaans, Swati, Tswana, Venda, Xhosa, Tsonga, Sotho, Zulu, Ndebele are also featured.
The history and diverse culture of the country is in some way commemorated on the physical South African currency. All these wonderfully unique languages are incorporated in some form of the rand whether that be on the coins or notes.
Whats the history of the South African currency?
Currency has been used in the region since 1652. And the long history of currency usage developed in the twentieth century, from the British Pound to the South African Rand. On 14 February 1961 the rand was established as the official South African currency. Five years earlier a commission recommended that South Africa give up the British pound and all the associated terms such as pounds, shillings and pence.
The rand was initially strong because it was based on the South African Pound which at the time was as strong as the US dollar. Since then due to apartheid and a host of other factors the currency declined in value.
The symbol of the South African Rand is ZAR. So when you see the rand compared to other currencies like the dollar or the pound you will see ZAR to USD, or ZAR to GBP. The fact that the South African rand is used in neighbouring countries has helped the nations develop at a similar pace and it has strengthened the legitimacy of the currency on a global scale.
What about the exchange rates?
The exchange rates are always changing but in recent years the rand has been more stable and it has remained relatively strong compared to the major currencies around the world.
In 2020 the average dollar to rand exchange rate was 1 ZAR to 0.0611 USD. There were fluctuations during what was a difficult year for economies around the world. However, in 2021 the rands relationship to the United States dollar has marginally improved. The average dollar to rand exchange rate in 2021 is 1 ZAR to 0.0685 USD.
It helps to have an idea of exchange rates before sending money overseas to ensure that you are making the most of your money. If you live in a country like the UK or USA with a strong currency you should take that into account if you are sending money home to loved ones in countries around the world like South Africa.
In 2020 the average South African Rand to British Pound exchange rate was 1 ZAR to 0.0476 GBP. As with the US dollar, the rands relationship with the British pound has marginally improved in 2021. The average rand to pound exchange rate in 2021 being 1 ZAR to 0.0494 GBP. So, as you can see the South Africa Rand is not so strong right now but compared to many other currencies around the world it is stable and there is potential for growth.
Send Money with Small World
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Thats why we offer a variety of services to ensure that we are catering for the financial needs of people around the world. Whether you need to transfer money from the UK or the US to South Africa to support your family back home or you have to pay an overseas supplier you can use Small World to facilitate the transfer. You can send money to South Africa via bank deposit, and we have partnered with many of the top banks in South Africa to ensure you are getting the best experience.
For over a decade, we have been helping people support their loved ones back home with our seamless global money transfer service. If you need to send money, were here to help you.
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