Starting 1 October 2020, Ukrainians will no longer be able to use in their cash settlements 25-kopiika coins and hryvnia banknotes designed before 2003. These currency units will cease to be legal tender and will be withdrawn from cash circulation.
From the date noted above, all stores, restaurants, and service providers will stop accepting them when receiving cash payments for goods and services, and will hand over all of their remaining coins and banknotes in question to the banks’ cash desks until 16 October 2020 so that this cash can be credited to their respective transaction accounts.
At the same time, the public will be able, without limitation and free of charge, to exchange their 25-kopiika coins and hryvnia banknotes designed before 2003 for circulating coins and banknotes of all denominations in amounts divisible by ten kopiikas over the next three years at the following locations:
- during the first year from the date of withdrawal from circulation through 30 September 2021, in all offices of Ukrainian banks
- during three years after the withdrawal date through 30 September 2023, at the NBU and authorized banks (Oschadbank JSC, CB PrivatBank JSC, Raiffeisen Bank Aval JSC, FUIB JSC ).
Regarding one- and two-hryvnia banknotes and one-hryvnia coins of the old design
One- and two-hryvnia banknotes designed in 2003–2007, and circulating old-design (gold-colored) one-hryvnia coins minted before 2018 remain legal tender. There is no need to exchange them, as they will continue to be used for payment.
However, after said cash is received by the banks, it will not be reintroduced into circulation. Instead, the banks will deliver it to the NBU (for disposal).
The number of these coins and banknotes in circulation will gradually decrease as they are replaced with circulating silver-colored one- and two-hryvnia coins designed in 2018.
Purposes and reasons
The main benefits of the withdrawal of 25-kopiiika coins and banknotes designed before 2003, as well as the replacement of banknotes with coins, are as follows:
- simplifying cash settlements and making them more comfortable
Today, 25-kopiika coins cannot be exchanged for smaller denomination coins due to the withdrawal of 1-, 2-, and 5- kopiika coins from circulation last year. Pulling these coins from circulation will solve the problem. At the same time, it will have no effect on inflation, as the rounding rules that came into effect in Ukraine on 1 July 2018* will continue to apply even with no 25-kopiika coins in use. Under these rules, the amount of a cash transaction involving goods or services (as printed on the receipt) can be rounded to the closest values divisible by 10 kopiikas.
The old-design banknotes introduced in 2003 have all but ceased to perform their legal tender function. These notes account for no more than 1.8% of the total number of banknotes currently in use (about 50 million). Over the past three years, the number of these notes in circulation has hardly changed. That means that people almost never use them for payment. The banks neither collect nor receive these banknotes. Their withdrawal will do no harm to the public and will be of benefit for both business and the state.
- positive economic effect
The state and other participants of cash circulation will now reduce their expenses on production, processing, transportation, and storage of banknotes and coins. In particular, the state can save over UAH 90 million per year due to the reduction in the regulator’s expenses on the production and processing of low-denomination coins.
- improved quality of cash in circulation
The NBU attaches great importance to the reliability, security, and quality of the hryvnias in circulation. The withdrawal of outdated banknotes of the previous series and a gradual replacement of the unfit one- and two- hryvnia banknotes with coins will improve the security and quality of the money in circulation.
In this way, the NBU continues the optimization of cash circulation it has been conducting over the past few years to simplify settlements.
Upon completion of all the processes related to the withdrawal of 25-kopiika coins and old and unfit banknotes, the number of hryvnia denominations will be reduced from 17 to 12 during the next three years. This will streamline existing hryvnia denominations and make them more comfortable to use
The new denomination series will have six coin denominations and six banknote denominations, in line with international practices. It will enhance the security and quality of money, while making cash settlements more comfortable.
* pursuant to NBU Board Resolution No.25 On Optimization of Low-Denomination Coin Circulation dated 15 March 2018 and paragraph 23 of the Procedure for Trade Operations and Rules of Trade Servicing in the Consumer Goods Market approved by Resolution of the Cabinet of Ministers of Ukraine No. 833 dated 15 June 2006 (as amended).
The following denominations will remain in cash circulation:
- low-value coins of 10- and 50-kopiika denominations
- circulating 1-hryvnia coins of the old design and 1-, 2-, 5- and 10-hryvnia coins designed in 2018
- banknotes of 1-, 2-, 5-, 10-, 20-, 50-, 100-, 200-, 500-, and 1000-hryvnia denominations designed in 2003–2019.
All business entities and bank institutions are obliged to accept them as a means of payment and to credit them to accounts.
From 1 October 2020, hryvnia banknotes of all years of issuance designed before 2003 (first and second hryvnia series) are to be withdrawn:
- 1-hryvnia banknote designed in 1992
- 1-hryvnia banknote designed in 1994
- 1-hryvnia banknote designed in 1995
- 2-hryvnia banknote designed in 1992
- 2-hryvnia banknote designed in 1995
- 2-hryvnia banknote designed in 2001
- 5-hryvnia banknote designed in 1992
- 5-hryvnia banknote designed in 1994
- 5-hryvnia banknote designed in 1997
- 5-hryvnia banknote designed in 2001
- 10-hryvnia banknote designed in 1992
- 10-hryvnia banknote designed in 1994
- 10-hryvnia banknote designed in 2000
- 20-hryvnia banknote designed in 1992
- 20-hryvnia banknote designed in 1995
- 20-hryvnia banknote designed in 2000
- 50-hryvnia banknote designed in 1992
- 100-hryvnia banknote designed in 1992
- 200-hryvnia banknote designed in 2001
Photos and detailed description of all these designs can be found at the NBU’s official website.