Economics

What is the Currency of Rwanda?

The official currency of Rwanda is the Rwandan franc.

Rwanda is an east African country with a subsistence economy based on agriculture. Agriculture employs more than 90% of the population and contributes significantly to the GDP. Rwanda uses the Rwandan franc as its legal tender and experiences an inflation rate of about 6.7%. Rwanda is a member of the East African Community and are part of the plan to introduce the East African Shilling. The Rwandan franc is not pegged to any currency, and therefore, its value tends to change with shifting economic trends.

History

Before the introduction of the Rwandan franc, Rwanda used various currencies depending on the colonial power operating at the particular time. The German East African rupee was the first currency used and was later replaced by the Belgian Congo franc.

The German East African rupee

The German East African rupee was introduced to the German’s east African colonies in the 1890s. The currency was circulated in Rwanda, Burundi, and Tanganyika. The currency existed in the form of coins and banknotes of various denominations issued by the Deutsch-Ostafrikanische Bank. After Germany’s loss in the First World War, the countries using the German East African rupee replaced the currency. Rwanda adopted the Belgian Congo franc as its legal tender in 1916.

The Belgian Congo franc

The Belgian Congo franc was introduced by the Belgians as the official legal tender in Congo. The circulation of the franc in Burundi and Rwanda began in 1916 after WW1. The franc existed in coin and banknote form with the coins made of various materials such as copper, nickel, bronze, brass, and aluminum or a combination of two metals. In Rwanda, the currency remained the legal tender until 1960 when the Rwandan franc was introduced.

The Rwandan franc

The Rwandan franc is the official legal tender of Rwanda. The currency is abbreviated as RWF and has the symbols FRw and RF. The Banque Nationale du Rwanda is the central bank of Rwanda responsible for issuing the Rwandan franc. The Rwandan franc was introduced in 1960 with the first issue in 1964. Each franc has 100 subunits called centimes. The franc is issued in various denominations and forms. Coins come in small denominations of 1, 2, 5, 10, 20, and 50 francs with the 100 franc coin being the highest valued coin. Coins are made from various metals including bronze, aluminum, nickel, steel, and copper. Some of the coins have mixed metals such as the 100-franc coin, which is made of steel plated with copper at the center and nickel on the outer ring. Banknotes are issued as 500, 1000, 2000, and 5000 francs and have different designs and colors. The 20, 50 and 100 franc notes were replaced by coins in 1977 and 2007 for the 100 franc note. Recent issues of the high-value notes have no French descriptions with their security features reinforced.

Exchange rates

As of July 7, 2017, the exchange rates of the Rwandan franc with different currencies locally and regionally are as follows. The Rwandan franc exchange at a rate of 1 US dollar for every 830.632518 Rwandan francs, 941.8957 Rwandan francs for every euro, 640.0559RWF for every Canadian dollar, and 7.338638 Rwandan francs for every Japanese yen. The Rwandan franc compares favorably with local currencies such as the Kenyan shilling exchanging at a rate of 1KES for every 8.00439.

More in Economics