Japan is in the process of redesigning its 500-yen coin and three denominations of bank notes. The announcement by Japanese Finance Minister Taro Aso came on the heels of the April 1 announcement of the new imperial Reiwa Era that will commence May 1. Crown Prince Naruhito will succeed Emperor Akihito on that date. Akhito is abdicating, giving his advanced age and poor health as the reasons for taking this unusual step.
Some government officials welcomed the timing of the currency change announcement, but the announcement appears to be coincidence rather than having been made on purpose. The new coin will not be available until 2021, while the bank note changes won’t be introduced until 2024. Japan changes designs on its bank notes about every 20 years, according to Aso, to stay ahead of counterfeiters. Japan announced its last change in bank notes in 2002, introducing the new bills two years later.
The government decided in 1984 that bank notes would remain politically neutral by depicting vignettes of cultural figures from the Meiji Era or later rather than political or military leaders. Individuals are not depicted on Japan’s coinage.
Japan’s 500-yen coin (expressed as ¥500) was introduced in 1982 as a replacement for the bank note of the same face value. As such it is the highest denomination coin in circulation. The bank note was officially phased out two years later. That same year South Korea introduced a 500-won coin valued at about one tenth of the value of the ¥500 but of the same diameter and metal composition. The South Korean coins were accepted in Japanese vending machines. Since the South Korean coins weigh slightly more, people drilled a hole in the 500 won to compensate for the discrepancy.
In 2000 Japan altered the ¥500 by adding zinc to the coin’s metal composition. The weight of the Japanese coin was reduced by 0.2 grams by this action, while the zinc provides an electronic signature that impacts their detection by vending machine mechanisms. A latent image was added to the image of the two zeroes within the obverse denomination numeral. This image can be viewed when holding the coin at an angle. The word ‘Nippon’ appears in micro printing on each side of the Japanese coin beginning in 2000.
While the April 9 issue of The Asahi Shimbun newspaper described the proposed new coin as being “bi-color clad,” other unofficial sources indicate it will be a ringed bimetal coin with a copper-nickel central plug and a nickel-brass outer ring. The newer version of the 500-yen is understood to include micro printing and an interrupted reeded edge.
The new 1,000-yen bank note is planned to feature a vignette of medical scientist Hideyo Noguchi (1876-1928) on the front, with the woodblock print Kanagawa Oki Namiura (Under the Wave off Kanagawa) by Katsushika Hokusai on the back.
The 2,000-yen bank note will not be changed as the note does not circulate very much. The new 5,000-yen bank note will depict Tsuda University founder and women’s education pioneer Umeko Tsuda (1864-1929) on the front vignette, with wisteria flowers featured on the back.
“Father of Japanese capitalism” banker and business leader Eiichi Shibusawa (1840-1931) will appear on the front of the new 10,000-yen note, with a vignette of the Marunouchi side of Tokyo Station on the back.
It is anticipated it will take three to four years to replace all bank notes with the new designs. Nothing was known of the future of the older coins at the time this article was being written, but it is likely the old and new coins and bank notes will circulate simultaneously until some date yet to be announced.
The April 10 issue of The Japan News reported, “The issuance of new bank notes may spur special demand for such companies as vending machine manufacturers. According to one estimate, the new issuance will push up the gross domestic product by about ¥1.3 trillion… If the new issuance leads to moves to exchange old bills for new ones, such household savings would become ‘live money’ for such uses as investment, possibility leading to revitalization of the economy.”
According to the Bank of Japan’s Flow of Funds Accounts statistics, cash held by households is estimated to be worth about ¥92.7 trillion, an increase of nearly ¥20 trillion in five years. Japan continues to be a cash-oriented, rather than electronic payment transfer oriented, society.