The kwacha (; ISO 4217: MWK, official name Malawi KwachaISO 4217 amendment number 162 dated 24 Feb 2016, change of currency name) is the currency of Malawi as of 1971, replacing the Malawian pound. It is divided into 100 tambala. The kwacha replaced other types of currency, namely the British pound sterling, the South African rand, and the Rhodesian dollar, that had previously circulated through the Malawian economy. The exchange rate of the kwacha undergoes fixed periodical adjustments, but since 1994 the exchange rate has floated.Frederic L. Pryor, The political economy of poverty, equity, and growth: Malaŵi and Madagascar Oxford University Press, 1990 , p. 415 In 2005, administrative measures were put in place by Bingu wa Mutharika to peg the exchange rate with other currencies.Annual Report on Exchange Arrangements and Exchange Restrictions, International Monetary Fund, 2006, , p[page 716 Banknotes are issued by the Reserve Bank of Malawi. In May 2012, the Reserve Bank of Malawi devalued the kwacha by 34% and unpegged it from the United States dollar. The currency was further devalued by 25% by the central bank in May 2022 followed by another 44% devaluation in November 2023 raising inflation rate in Malawi.

Etymology

The name kwacha was first used in Zambia, where the Zambian kwacha was introduced in 1968. It derives from the Chinyanja or Chichewa word meaning "it has dawned", while tambala translates as "rooster (cock)" in Chichewa. The tambala was so named because "a hundred roosters announce the dawn."Jacobs, L. L. (2000:68). Quest for the African Dinosaurs: Ancient Roots of the Modern World. United States: Johns Hopkins University Press.

History

The kwacha replaced the Malawian pound on 15 February 1971 (on the same day the United Kingdom decimalised) at a rate of two kwacha to one pound. Malawi followed the pattern of South Africa, Australia, and New Zealand in that when it adopted the decimal system, it decided to use the half pound unit as opposed to the pound unit of account.

one British pound sterling was equal to approximately 883.43 kwachas, one US dollar was equal to 725.16 kwachas and one South African rand was equal to 47.69 kwachas. one Euro is equivalent to 797.42 Kwachas.XE Currency Converter

one British pound sterling was equal to approximately 2349 kwachas, one US dollar was equal to 1734 kwachas, one South African rand was equal to 104 kwachas and one Euro was equivalent to 2063 Kwachas.Reserve Bank of Malawi - Middle Rate However, in the street, US dollars can bring a black market rate of 4300 kwachas.

Coins

The first coins introduced in 1971 were in denominations of 1, 2, 5, 10 and 20 tambala. In 1986, 50 tambala and 1 kwacha coins were also introduced. In January 2007, 5 and 10 kwacha coins, which actually bear a mint date of 2006, were also released into circulation. On 23 May 2012 new 1, 5 and 10 kwacha coins were released into circulation

The 1 and 2 tambala coins are composed of copper-plated steel. The 5 tambala coin is of nickel-plated steel. The 50 tambala and 1 kwacha coin are composed of brass-plated steel."Malawi ." NumisMaster. F+W Publications, Inc. 2011. Web. 17 February 2011.

Due to inflation, coins below 10 kwacha are very rarely used because of their minimal value.

Banknotes

In 1971, banknotes dated 1964 were introduced in denominations of 50 tambala, 1, 2 and 10 kwacha. 5 kwacha notes were introduced in 1973 when the 2 kwacha note was discontinued. 20 kwacha notes were introduced in 1983. 50 tambala notes were last issued in 1986, with the last 1 kwacha notes printed in 1992. In 1993, 50 kwacha notes were introduced, followed by 100 kwacha in 1993, 200 kwacha in 1995, 500 kwacha in 2001 and 2000 kwacha in November 2016 to ease desperate cash shortages., Nyasa Times

As of 2008, the following banknote denominations are in circulation: 1997 Series Image Value Dimensions Main Colour Description Date of first printing Obverse Reverse K5 126 × 63 mm Green John Chilembwe Villagers mashing grain 1 July 1997 K10 132 × 66 mm Brown Children in "bush" school K20 138 × 69 mm Purple Workers harvesting tea leaves K50 144 × 72 mm Blue Independence Arch in Blantyre K100 150 × 75 mm Red Capital Hill in Lilongwe K200 156 × 78 mm Blue Reserve Bank building in Lilongwe K500 162 × 81 mm Multi-colour Reserve Bank building in Blantyre 1 December 2001

According to an article in the Nyasa Times dated 9 March 2012, within the next six months the Reserve Bank of Malawi would introduce a whole new series of notes, including a 1,000-kwacha note, twice the largest denomination currently in circulation. The notes were announced in Biantyre on 8 March by Governor Dr. Perks Ligoya. The new notes would be much smaller in size than the current notes, which served as a cost-cutting measure. The new 1,000-kwacha note was going to be printed by De La Rue.Malawi new banknote family confirmed BanknoteNews.com. Retrieved 2012-05-17.

On 23 May 2012, the Nyasa Times reported that the Reserve Bank of Malawi introduced the new 1,000 kwacha note into circulation along with the proposed new notes. The new 1,000 kwacha note was valued at around US$4. The new kwacha had the face of the first president Kamuzu Banda on the front and the back carries a depiction of Mzuzu maize silos.

The new 20 kwacha note was found to contain an error. On the back of the note is a building identified as the Domasi Teacher's Training College (now known as the Domasi College of Education). However, it is reported that the building is, in fact, the Machinga Teacher's Training College.Reserve Bank goofs on new K20 banknote , Mawali Today, retrieved 2012-06-04.

The Reserve Bank of Malawi is going to revise its new family of notes so that they are more "blind friendly". According to the Malawi Union of the Blind, the current notes have raised dots to aid in recognition of the denominations, but the dots are too small to be useful.Malawi Central-Bank to issue new blind friendly bank notes , Amalawi.info. Retrieved 2012-07-15.

2012 Series Image Value Dimensions Main Colour Description Date of first printing Obverse Reverse Obverse Reverse K20 128 × 64 mm Purple Reserve Bank of Malawi headquarters in Lilongwe; Inkosi ya Makhosi M’mbelwa II (Lazalo Mkhuzo Jere) Machinga Teachers Training College building and tree; stack of books and mortarboard 23 May 2012 K50 Light blue and green Reserve Bank of Malawi headquarters building in Lilongwe; Inkosi Ya Makhosi Gomani II (Philip Zitonga Maseko) Elephants, tree, and safari vehicle in Kasungu National Park K100 Red Reserve Bank of Malawi headquarters building in Lilongwe; James Frederick Sangala College of Medicine in Blantyre; stethoscope K200 132 × 66 mm Blue and violet Reserve Bank of Malawi headquarters building in Lilongwe; Rose Lomathinda Chibambo New Parliament building in Lilongwe K500 Brown and orange Reserve Bank of Malawi headquarters building in Lilongwe; Reverend John Chilembwe Mulunguzi dam in Zomba; water spigot; silhouette of woman carrying container on head and man carrying hoe over shoulder K1000 Green Reserve Bank of Malawi headquarters building in Lilongwe; Dr. Hastings Kamuzu Banda Mzuzu maize silos; stalk of maize (corn); silhouette of two people mashing maize K2000 Yellow Reverend John Chilembwe; outline of Malawi Malawi University of Science and Technology, Thyolo District 1 June 2016

2022 Series Image Value Dimensions Main Colour Description Date of first issue Obverse Reverse K2000 135 × 66 mm Orange Reverend John Chilembwe; outline of Malawi Blantyre Magistrate Court 24 February 2022 K5000 Purple Dr. Hastings Kamuzu Banda; outline of Malawi Reserve Bank of Malawi Mzuzu branch

See also Economy of Malawi Zambian kwacha

References