7 Currency Facts About the Emirati Dirham
The official currency of Dubai and the United Arab Emirates, AED, is the abbreviation for United Arab Emirates Dirham. Dhs or DH denotes it. Dirham has been in vogue since 1973 when it replaced all other currencies like Dubai riyal or Qatar riyal.
The name dirham is derived from the Arabic word. The dirham survived the Ottoman Empire due to centuries of commerce and use of the currency. Prior to 1966, the Gulf rupee, which was fixed at parity with the Indian rupee, was used by all the emirates that today make up the UAE. India opted to depreciate the Gulf rupee against the Indian rupee on June 6, 1966. Refusing to accept the devaluation, some states who were still using the Gulf rupee switched to their own or other currencies.
Except for Abu Dhabi, all Trucial States adopted the Qatar and Dubai riyal, which was equal to the Gulf rupee before the devaluation. During the changeover from the Gulf rupee to the Qatar and Dubai riyal, these emirates briefly used the Saudi riyal. The Bahraini Dinar was used in Abu Dhabi at a rate of 10 Gulf rupees = 1 dinar. The UAE dirham was introduced as its currency in 1973.
7 Interesting facts about Dirham (AED)
1. Basic features
The United Arab Emirates comprises 100 fuloos, which is the plural version of the word fils. Fils is the unit of measurement for Iraqi dinars, Kuwaiti dinars, Bahraini dinars, and Yemeni rials. The 1-unit dirham is exclusively available in coin form. The other denominations of 5, 10, 20, 50, 100, 200, 500, 1000 are available in banknote form. The Central Bank of Dubai issues these banknotes. Every note has the national symbol on the obverse side. Each symbol on the UAE currencies has a specific meaning. A classic Dirham insignia depicts a golden falcon with a disc. It is ringed in the middle by seven stars and seven feathers, which represent the seven Emirates.
2. Stuck in time
The Dirham was formally tied to the IMF’s special drawing rights on January 28, 1978. In reality, it is almost always connected to the US dollar. The country is majorly reliant on the oil industry, and officials find it advantageous to peg its currency to the American dollar. By pegging its currency to the US dollar, they aim to reduce the volatility of exports.
For example, oil prices collapsed massively in 2015, hitting the economies of the GCC countries really hard. Many countries were thinking of devaluing their currency against the US dollar. Naturally, US dollars collected from these countries would mean more return in terms of Dirhams. Since November 1997, the dirham has been tied to the 1 US dollar = 3.6725 dirham exchange rate, which converts to around 1 dirham = 0.272294 dollars.
3. Coins
In the year 1973, coins were introduced in the denominations of 1, 5, 10, 25, 50 fils and measuring up to one dirham. The lower denominations are made of bronze, while the higher denominations are made of cupro-nickel. The size of the fil coins was the same when compared to corresponding Dubai and Qatar dirham coins. Since 1995, the size of 5 fils, 10 fils, and 50 fils has been decreased. The new 50 fils are curve-equilateral-heptagonal shaped.
The text of the coins is Arabic, and the coins are written in Eastern Arabic numerals. The 1, 5, and 10 fils coins are rarely used for daily transactions, so all the amounts directly are rounded up to multiples of 25 fils. The 1 fil coin has become a rarity and is almost completely out of circulation. There are also commemorative coins that the Currency Board of United Arab Emirates has minted ever since 1976.
4. Watermarks
A Falcon watermark was added to all AED bills to prevent fake copies from being made. This was undertaken as a security measure to prevent counterfeit bills from being issued.
5. We stand united
A Federation of seven emirates: Abu Dhabi, Ajman, Dubai, Fujairah, Ras Al Khaimah, Umm Al Quwain, and Sharjah. Each of these Emirates utilized the same and more convenient currency. Previously, each of these Emirates used the currency of the nation closest to it. Currently, all Emirates residents use the same money, which is easier for them to transact.
6. Money map
The coins and the dirham denominations are beautiful, and they represent a lot of facts. The designs on the dirham are breathtakingly natural. Some of these showcase the beautiful architecture of the country. Others deal with the cultural aspects of Arabia, its animals, outdoor scenes, etc. The Blue Souk of Sharjah is outlined in 5 Dirham banknote. It is the Central market for shopping and trade.
7. Currency Misuse: Violations and Penalties
The currency of the UAE carries with it the emblem of the country; therefore, the money has infinite moral value. Notwithstanding its material value, any behavior that is labeled as inappropriate is punishable by law.
Thus, the UAE Dirham is highly convenient to use, and transactions have become easier ever since the currency came to be used. But not only this, they offer us a sneak peek into the heritage of the Arabian nation. The country has maintained its cultural integrity over the years, and its currency typically represents it.
Endnotes
So there, you have a look into the rich and exciting past of the UAE through the Emirati Dirham. Don’t be misled by the skyscrapers; there’s much more to this nation than meets the eye. The UAE has its own cultural character that it has proudly retained over many years of development and growth, lying just under the sparkling retail malls and vertigo-inducing structures.
