Iran’s parliament has approved a plan to drop four zeros from its national currency, the rial. The move is aimed at easing financial transactions and restoring public confidence in the economy.
The bill, passed on Sunday, will replace 10,000 current rials with one new rial, according to Iran’s legislative website. The decision comes as the country faces renewed international sanctions and a sharp decline in the value of its currency.
Lawmakers passed the plan two months after a parliamentary commission revived the long-discussed proposal, which had been shelved for years. Under the new plan, both the old and new rials will circulate for up to three years. The Central Bank of Iran will have two years to complete the transition.
The rial has suffered repeated record lows in recent weeks, with the black market exchange rate reaching about 1,115,000 rials per US dollar on Sunday. That marks a steep fall from around 920,000 rials to the dollar in early August, when the currency reform plan was reintroduced.
The redenomination proposal was first raised in 2019 but was put on hold amid worsening economic conditions and international isolation. The move now awaits approval from the powerful Guardian Council and the signature of President Masoud Pezeshkian before it becomes law.
Iran’s economy has been under severe strain due to the reinstatement of United Nations sanctions. Last month, Britain, France, and Germany triggered the “snapback” mechanism to reimpose sanctions, citing Iran’s non-compliance with the 2015 nuclear agreement.
In everyday transactions, Iranians already simplify prices by informally dropping a zero from the rial, using a smaller unit known as the “toman.” The government hopes that the official currency reform will reduce confusion in financial dealings and help stabilise the economy.
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Shivam Verma is a journalist with over three years of experience in digital newsrooms. He currently works at NewsX, having previously worked for Firstpost and DNA India. A postgraduate diploma holder in Integrated Journalism from the Asian College of Journalism, Chennai, Shivam focuses on international affairs, diplomacy, defence, and politics. Beyond the newsroom, he is passionate about football—both playing and watching—and enjoys travelling to explore new places and cuisines.
