BHUTAN FOREIGN CURRENCY

Currency and coinage of the Himalayan Kingdom of Bhutan: Ngultrums and Chhertums:

Background:

Bhutan is a tiny Himalayan kingdom which until the1960s was only accessible on foot. It is known as “the last Shangri-la” and the “Druk Gul” or “The Land of the Thunder Dragon”, primarily due to its severe snow storms. Bhutan’s citizens are Buddhists and treasure their spectacular environment as the source of all life and the home of the Gods.

Bhutan ranges in elevation from 600 feet to over 21000 feet in the majestic Himalayas. It is home to several exotic wildlife, including,  tigers, red pandas, blue sheep, takins (goat-antelopes), elephants and snow leopards.

History of the Royal Monetary Authority (RMA) Bhutan:

The Central Banking functions were earlier conducted by three Agencies: the Ministry of Finance, State Trading Corporation of Bhutan and Bank of Bhutan.

The division of functions between the three Organisations was as follows:

a)   The Ministry of Finance was then the currency issuer of Ngultrum (the Bhutanese currency).

-      The Ministry also functioned as the custodian of Foreign Exchange balances received as aid which were kept with correspondent Banks abroad in the name of the Ministry of Finance.

b)   The State Trading Corporation of Bhutan, handled exports to countries other than India and repatriation of foreign exchange balances received essentially as aid, which was kept with correspondent Banks abroad in the name of the Finance Ministry.

c)   The Bank of Bhutan handled all commercial banking business in Bhutan and extended credit to the Government, financed other Government Organisations against Government Guarantees and was the distribution channel for Ngultrum notes and Chhetrum coins to the public.

From 1982, the Central Banking functions have been taken over by the Royal Monetary Authority (RMA).

History of Currency and coinage development in Bhutan:

-      Bhutan first produced silver coins towards the end of the 18^th century, primarily for use in trade with the plains. Prior to that, a system of barter in rice, butter, cheese, meat, wool, hand woven cloth and other local produce was in vogue.

-      Later, coins minted in silver alloy, copper or brass were circulated and were used mainly for local purchases. These coins known as “Ma-trum” or “Chhe-trum” were struck by several local chieftains, rather than at a centralised set-up.

-      At the beginning of the 20^th century, the quality of striking of coins improved under the first King, Druk Gyalpo Ugyen Wangchuck (1907 – 1926).

-      In 1928, during the reign of the second King Druk Gyalpo Jigme Wangchuck (1926 – 1952), fine machine struck silver and copper coins were circulated – marking the beginning of the age of modern coinage in Bhutan.

-      Despite these measures, barter system still remained the primary means of carrying out transactions and even Government officials were paid in kind, rather than in cash.

-      In the mid-1950s, during the reign of the third King Druk Gyalpo Jigme Dorji Wangchuck (1952-1972), the economy gradually became more monetised and the number of silver coin issues (nickel alloys) was increased.

-      In 1968, the Bank of Bhutan was established as a step towards further monetisation and most salaries were paid in cash, rather than in kind.

-       In 1974, the first Ngultrum Notes in the denominations of Nu. 1, 5, 10 and 100 in the year the Fourth “Druk Gyalpo” or the “Dragon King”, Jigme Singhye Wangchuk, was crowned. Later other Notes in the denominations of Nu.2, 20, 50 and 500 were added. The currency was standardised with 100 Chhetrum  being equal to 1 Ngultrum.     

 

The above is the image of the Front of a one Ngultrum Bank Note issued during the reign of the Fourth Druk Gyalpo issued by the "Bank of Bhutan", under authority from the Ministry of Finance, Government of Bhutan.

The above is the image of the back the one Ngultrum Bank Note issued during the reign of the Fourth Druk Gyalpo. The picture on this face shows the "Simtokha Dzong" ("Dzong" means a "fortress" in Dzongkha (the language of Bhutan). 
   The size of this note is 155 mm x 67mm (larger than the one Ngultrum notes presently issued).

Bhutan 2 ngultrum p6 1981 dragon palace large world currency money bill banknote

 Bhutan ngultrum note 1986

                  Description: The obverse of a Bhutanese 1 ngultrum banknote from 1986.
                  Date:   1986

 

Bhutan 1 ngultrum 1 unc note

The Front of the one Ngultrum Note has a “Khorlo” (the Wheel of Dharma, one of the eight auspicious signs – details given under Note on the “Tashi Tagye”: the eight auspicious symbols at the bottom of this post) in the centre with a dragon each on the left and right hand sides of the Note. On top is mentioned “Royal Monetary Authority of Bhutan”, in Dzongkha (the language of Bhutan). This Note was printed under the “Series 2006” issues.

 

The Back of the one Ngultrum Note shows the “Simtokha Dzong” (Dzong means a “fortress”).  The “Royal Monetary Authority of Bhutan” is mentioned on top in English on the Note. On the bottom are mentioned “1” in numerals and “one Ngultrum” both in English and Dzongkha, which is the denominational value of this Note.

-      The size of the Note is 120 mm x60 mm.