November 14, 2025 | 11:09 am
TEMPO.CO, Jakarta - Redenomination is the process of reducing the nominal value of a currency without affecting its exchange value or purchasing power. This process is often carried out to simplify transactions when a nation experiences hyperinflation or an economic crisis.
Through redenomination, a country can eliminate a number of zeros from the currency to facilitate economic activities. Throughout history, there have been countries that have undergone some of the largest redenominations, including Germany and China, as cited by id.investing.com.
1. Hungary (1946)
In 1946, Hungary undertook the largest currency redenomination in global history by replacing the pengö with the forint. Hyperinflation that followed immediately after World War II caused prices to skyrocket rapidly, forcing Hungary to eliminate 400 octillion pengo, equivalent to 1 forint. Banknotes worth 20 octillion pengo became very common at that time.
2. Zimbabwe (2009)
Zimbabwe experienced one of the worst hyperinflations in modern history in 2009. The Zimbabwean currency, the Zimbabwean dollar, devalued so severely that one fourth dollar equaled 10 septillion first Zimbabwean dollars. During this period, the Zimbabwean government carried out a series of redenominations and finally demonetized the Zimbabwean dollar, replacing it with foreign currencies such as the US dollar, euro, and China's yuan.
3. Germany (1923)
After World War I, Germany faced very high inflation exacerbated by large war reparations. In 1923, the government replaced the Papiermark currency with the Rentenmark after inflation reached a rate of 29,500 percent. The highest denomination Papiermark in circulation reached 100 trillion marks, and 1 trillion mark was replaced with 1 Rentenmark to stabilize the economy.
4. Greece (1944)
Greece faced severe hyperinflation in 1944, due to German occupation during World War II. At the peak of inflation, reaching 31010 percent, the country replaced 50 billion drachma with a new unit of currency at a ratio of 50,000,000,000:1 to facilitate transactions and stabilize the economy.
5. Yugoslavia (1994)
Yugoslavia experienced hyperinflation during the civil war between 1992 and 1994. The dinar currency underwent four redenominations during this period, with one new dinar equivalent to one billion old dinars in 1994. This made it one of the shortest-lived currencies in history.
6. Nicaragua (1991)
Nicaragua also carried out a redenomination in 1991 due to severe inflation caused by civil war and budget deficits. The old currency, cordoba, was replaced with a new and simpler unit to facilitate economic transactions.
7. Zaire (Congo) Republic (1993)
Zaire underwent redenomination in 1993 after a drastic devaluation of the currency. The old currency, zaire, was replaced with the Nouveau Zaire, where 3 million old zaire was equivalent to one Nouveau Zaire. However, inflation continued, and in 1997, the government replaced the currency again with the Congolese franc.
8. Bolivia (1987)
Bolivia underwent a massive redenomination in 1987, changing the peso boliviano to the new boliviano at a ratio of 1 million:1 after high inflation. At the peak of inflation in 1985, one US dollar was equivalent to one million peso boliviano. This redenomination helped stabilize the economy and reduce inflation in the early 1990s.
9. Peru (1991)
In the late 1980s, Peru faced severe inflation due to ineffective monetary policies. In 1991, the Peruvian government replaced the old sol with the new sol, at a ratio of 1 million:1. This step helped reduce inflation and create better economic stability.
10. China (1949)
The Republic of China also underwent redenomination in 1949 after facing hyperinflation due to civil war and the Sino-Japanese War. The old yuan was replaced with the gold yuan at a ratio of 3 million old yuan equivalent to 1 gold yuan. Although stabilization efforts were made, inflation remained high, and the gold yuan was eventually devalued.
Melynda Dwi Puspita contributed to the writing of this article.
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