Ukraine Hryvnia (UAH): What it is, History

What Is the Ukraine Hryvnia (UAH)?

The term Ukraine hryvnia (UAH) refers to the national currency of Ukraine. The currency was adopted by the country's government in 1996. The currency, which is also sometimes written as hryvnya or grivna, is subdivided into 100 kopiykas. The hryvnia is abbreviated as UAH in the foreign exchange market. Currency is printed by the country's central bank, the National Bank of Ukraine, which is responsible for maintaining financial stability and the country's economic development.

Understanding the Ukraine Hryvnia

Ukraine's economy was once one of the largest of the Soviet Bloc, with important industrial and agricultural regions. However, the move to a market economy has seen the nation struggling. Much of the population has turned to subsistence farming where the barter system allowed the people to obtain daily necessities. Government oversight and the issue of the UAH currency improved the situation only slightly.

The nation introduced the hryvnia as its currency on Aug. 26, 1996. It was officially put into circulation the following month. The hryvnia is abbreviated as UAH and is represented by the numerical code 980 on the forex markets. The currency's symbol is ₴.

The currency is printed and managed by the National Bank of Ukraine, the country's central bank. As of October 2022, there were ₴677.7 billion in circulation. Banknotes are printed in denominations of ₴10, ₴20, ₴50, ₴100, ₴200, and ₴500. The bank also issues hryvnia coins in ₴1, ₴2, and ₴5 denominations, which replaced bills of the same value between 2018 and 2020. One hryvnia is divided into 100 kopiykas. The National Bank of Ukraine minted these coins in one, two, five, 10, 25, and 50 denominations. The first three of these coins ceased to be legal tender as of Jan. 10, 2019.

In January 2023, the National Bank of Ukraine will gradually withdraw the 5-, 10-, 20- and 100-hryvnia paper banknotes from circulation that were designed in 2003 – 2007 and will replace them with newly designed coins and new-generation banknotes. The old paper money will be replaced by modernized banknotes and newly designed circulation coins including the  5- and 10-hryvnia circulation coins designed in 2018.

Special Considerations

The hryvnia is used throughout the country, except in the region of Crimea. The area formally adopted the Russian ruble (RUB) as its currency in March 2014 after the annexation by Russia that same year.

The Russian government announced that Crimeans could continue using the UAH as a parallel currency until the end of 2015. According to a Reuters report, there were varying exchange rates at businesses and other establishments. But Bloomberg reported that shops stopped using double pricing with the hryvnia and ruble in June 2014.

History of Ukraine Hryvnia (UAH)

The Ukraine hryvnia became the national currency of Ukraine in 1996, following the collapse of the Soviet Union. The name is derived from a unit of weight used in the Slavic region during medieval times.

An earlier currency by the same name circulated in the region in 1917 after it declared its independence from the Russian Tsarist Empire. Karbovanets banknotes circulated in the region between 1917 and 1920. But these notes, printed on ordinary paper, were easily counterfeited. During the occupation of the region through the two World Wars, a newer series of banknotes were used until the second and third issues of more secure karbovanets.

In 1996, the hryvnia replaced the karbovanets at a rate of 100,000 karbovanets to one hryvnia due to hyperinflation that occurred in the 1990s as a result of the collapse of the Soviet Union. This caused a massive devaluation of the older banknotes, rendering them almost worthless.