Being approved in a future Parliament session, the plan will be announced to the Central Bank of Iran (CBI).
The Central bank will then be expected to implement the plan within two years.
According to the CBI Governor Abdolnaser Hemmati crossing out four zeros from the national currency, Rial, will have no impact on the inflation rate adding that the central bank is ready to implement the plan.
He explained in early August 2019 that removing four zeros will have no costs for the government since CBI annually prints about 700 million of new bank notes and replacing the old ones with the new ones is a routine procedure.
On July 31, the government approved a plan to take four zeros off the national currency in a bid to curb the tide of liquidity and impede rial depreciation.
The plan to remove four zeros from the rial has been on the government agenda since it was proposed about seven months ago by Central Bank of Iran as part of a broader plan to revisit the monetary system.
According to the government website dolat.ir, the measure calls for fundamental change to the national currency, including changing the name of the monetary unit from the official rial to the popularly used ‘toman’. It stipulates change in the nominal value and the face of bank notes and coins.
Despite the fact that rial is the official currency, people use toman in informal transactions (1 toman = 10 rials).
MNA/IRN83681258