The Kingdom of Lesotho is a small country surrounded entirely by South Africa. Lesotho has an economy that depends largely on farming and manufacturing, with water and diamonds as its major resources. The country uses the Lesotho loti as its currency, alongside the South African rand. The South African rand served as the official currency in Lesotho until 1980 when the loti became the official legal tender. The first maloti were introduced in 1966 and were used as a non-circulatory currency until 1980. The first issue of the loti in the form of coins and banknotes was in 1979.
Lesotho uses the loti as its official currency. Introduced in 1966, the loti was first circulated in 1980 as a replacement of the South African rand. The loti has the symbol L, or M for the plural form maloti, and uses the code LSL. Each loti has 100 subdivisions called sente (plural lisente). The Central Bank of Lesotho is responsible for issuing the loti. The loti comes in various denominations including lisente coins of values 5, 10, 20, and 50 and maloti coins of values 1, 2, and 5. The loti banknotes are in denominations of 10, 20, 50, 100, and 200 maloti. The banknotes come in various designs, colors, and sizes, but have a standard width of 70mm. The M10 note measures 130 by 70 mm with red and yellow as its main colors. The M20 note is slightly larger, measuring 135 by 70 mm, with purple and light blue as its main colors. The M50 note is 138mm long and is colored violet. The M100 note is green in color with a length of 140mm, the M200 note has a length of 145mm and primarily orange in color. Counterfeiting of the currency led to the introduction of a new series in 2010.
Exchange Rates and Inflation
The Lesotho loti is exchanged with different foreign currencies at various rates. While rates change with the market conditions, the following exchange rates were valid as of June 29, 2017: the loti and the South African rand are at par; loti exchanges with the US dollar at a rate of 1 US dollar for 12.91 Lesotho maloti; one euro for 14.45 Lesotho maloti; and one Swiss franc for 13.30 Lesotho maloti. The Lesotho loti has an inflation rate of 6.8% mainly due to the changing economic conditions of the regional and global market. Lesotho engages in export trade of textiles and minerals with countries such as the US, South Africa, and European countries. Economic crises in these countries negatively affect the economy of Lesotho and the value of the loti against foreign tenders.
South African Rand
Although the loti was introduced as a replacement for the South African rand, the latter is still used in the country. Since South Africa and Lesotho are within the Rand Monetary Area, the rand and the loti are equal in value. The rand (R) has divisions of 100 cents (C) per rand. The South African Reserve Bank issues the rand in denominations of 10, 20, and 50 cents as well as 1 and 2 rand which come in coin form. Banknotes come in denominations of 10, 20, 50, and 100 rand.