The Polish Zloty
The Polish zloty (before 1995 - PLZ; then changed to PLN, zł) is the official currency of the Republic of Poland. It is not a freely convertible currency, and its circulation is limited solely to the country’s territory.
The monetary system of Poland used to be complicated and tedious before the zloty appeared. The grzywna, kopa, and grosz (silver coin) were circulating during that period. The latter was subdivided into szóstaks and trojaks. The szóstak comprised six groszy and the trojak - three.
In the Middle Ages, almost all European states introduced the ducat - a coin minted in Venice - as the means of payment. It appeared in Poland as well. At first, its exchange rate was approximately 12 groszy for one ducat. The Polish began to call it ‘zloty’ (‘golden’) to shorten the name.
As time passed, the Polish grosz devalued: one ducat cost 30 groszy, and then - 50 groszy. However, the Sejm decided to make the ducat exchange rate fixed (1 ducat = 30 groszy) and introduce the terms of the Polski złoty and the czerwony złoty.
The golden ducat became the czerwony złoty, and after the monetary reform of the 16th - 17th centuries, the Polski złoty obtained the status of the uniform monetary unit. It equalled half of the kopa or 30 groszy.
The first silver zloty was minted in the 16th century. Nominally, it equalled 30 groszy as before, but mass minting entailed the loss of pure silver. The actual weight of the metal in coins was not more than 3.3 grams, which constituted half of their general weight. Therefore, its real value was only 12 groszy, not 30.
The zloty got a new name - tymf, but people just called it złotówka. Tymf circulated till the last quarter of the 18th century though its introduction created many problems for the Polish financial system.
The partition of the country in the 18th century led to the appearance of a multitude of money varieties within its territories. The banknotes in enormous denominations of several million zlotys were issued. After the Russian Emperor’s troops conquered Warsaw, the Russian ruble along with fractional coins of the Russian Empire began circulating. Nonetheless, calculations of all the prices were made in zlotys and groszy because the Polish financial system complied with the silver standard at that time.
The Kingdom of Poland became part of the Russian Empire, and therefore, got the internal currency that circulated within its territory. That was the zloty pegged to the Russian ruble. Besides, the latter could also circulate along with the Polish currency.
After the Polish Uprising of the 1830s, the Russian government restrained the financial autonomy of the Kingdom, and in 1841, the ruble became the official currency. The only place where zloty continued to be minted and used for payments was Krakow as the free city.
In 1918, when World War I ended and Poland gained independence, there was the multi-currency circulation of the Austro-Hungarian krone, the German marka, the Russian ruble, and two occupational currencies like the Ostruble and the Ostmark.
In 1917, the Polish government decided to substitute all money with the Polish marka. The name was analogous to the German marka. That period was advantageous for both economy and finances, but the following events led to depletions of all country’s accumulated resources. Józef Piłsudski, Poland’s leader at that time, got into a war with USSR for the border regions of Ukraine, Belarus, and Lithuania.
As a result, the Polish marka became sharply devalued due to the significantly increased war expenses along with low taxes. In 1920, after an armistice with the Russian SFSR, the marka devaluation level was even higher. That is why in 1924, the monetary reform took place in the country. The zloty as the official currency of Poland returned with an exchange rate of 2 million markas.
However, the reform did not deter zloty from further devaluation. Negative economic processes were occurring in the background of coup d'état organised by Józef Piłsudski. The loan provided by the USA and strict financial policy under the supervision of banking experts from the West enabled stability of the zloty and even improvement of its status for the following several years.
Later, the issues resumed again. After the death of Piłsudski, the military forces gained authority. The only solution in an attempt to make the economy stable was to bring it under state control.
After World War II, Poland joined the socialist way of development. After 1944, the zloty underwent several monetary reforms and denominations because inflation continued to increase.
Only in the 1970s during a couple of years, some kind of stability appeared. However, in 1980, a devastating economic crisis commenced and led to the shift in power and a new course of Poland oriented to the capitalist model of economics. That was the time when the republic ceased to be socialist.
The inflation slowed down its rate and became controllable. At the beginning of the 1990s, the Polish economy depicted an unbelievable boost.
In 1995, the tenfold denomination of the old zloty took place, though the printing of new banknotes began a year earlier and the coin minting - in 1990. The banknotes in denominations from 10 to 200 zlotych and the coins from 1 to 50 groszy were introduced. That series got the name of a new zloty and a new international code - PLN.
Old money was withdrawn from circulation in 1996, but there was a possibility to exchange them in banks till 2010.
In 2015, a 500-zloty banknote was added to the existing ones, though it had not been previously planned to introduce it.
Since 2012, the issuance of modified banknotes began. They gradually substituted all older, damaged, and outworn paper money.
Zloty banknotes are issued in six denominations from 10 PLN to 500 PLN. Some commemorative notes have been issued as a dedication to various significant events in the country’s lives.
- zł10 is a brown banknote that measures 120 mm by 60 mm and features Duke Mieszko I on the obverse and a silver coin of his reign on the reverse.
- zł20 is a purple banknote that measures 132 mm by 66 mm and features King Boleslaus I the Brave on the obverse and a denar coin from his reign on the reverse.
- zł50 is a blue banknote that measures 132 mm by 66 mm and features the portrait of Casimir III the Great on the obverse. The reverse depicts the symbols of the king’s power like the seal and the mace in the background of Krakow.
- zł100 is a green banknote that measures 138 mm by 69 mm and features the portrait of King Władysław Jagiełło on the obverse. The reverse depicts the coat of arms and the sword of the Teutonic Knights and the Malbork Castle.
- zł200 is a yellow banknote that measures 144 mm by 72 mm and features King Sigismund I and the coat of arms from his chapel at Wawel Cathedral in Krakow.
- zł500 is a multicoloured banknote that measures 150 mm by 75 mm and features King John III Sobieski, the Polish coat of arms, and the palace.
There are four denominations of commemorative notes - 10, 20, 50, and 19 zlotych. The 20-zlotych banknote has eight modifications that differ from each other completely:
- zł20 is a red banknote issued in 2008 that measures 138 mm by 69 mm. There is the portrait of Józef Piłsudski on the obverse and the Polish coat of arms and the Monument of Polish Legions on the reverse.
- zł20 is a yellow banknote issued in 2009 that measures 138 mm by 69 mm. It features the portrait of the poet Juliusz Słowacki and his chalet on the obverse. The reverse depicts the monument of Sigismund III Vasa in the background of an excerpt from a poem and the Castle Square in Warsaw.
- zł20 is a three-colour banknote issued in 2011. It combines gray, white, and black array and features the portrait of Frederic Chopin, a fragment of his music sheet, and his house. The reverse includes an image of his etude in the background of a typical Polish landscape.
- zł20 is a banknote issued in 2011 of gray, brown, and white colour array. It measures 147 mm by 67 mm. The obverse features the portrait of Marie Skłodowska Curie and Sorbonne building. The reverse contains the image of her Nobel Prize medal, the building of the Radium Institute in Warsaw where she worked, and a quote from her lecture.
- zł20 is a multicoloured banknote issued in 2014 that measures 147 mm by 67 mm. It features the Belvedere Palace, the portrait of Józef Piłsudski, and the Polish coat of arms on the obverse. The reverse depicts the eagle badge of the Polish Legions and the Belvedere hologram.
- zł20 is a banknote issued in 2015 that measures 138 mm by 69 mm. It features the portrait of Jan Długosz and an open book on the obverse. The reverse contains the images of the Wienawa coat of arms and Wawel Cathedral in Kraków.
- zł20 is a banknote issued in 2015 that measures 144 mm by 77 mm. The colours are blue and rose. The obverse contains the portraits of Doubravka of Bohemia and Prince Miezko, the coat of arms of Poland, the cross, and one of the Catholic church floors. The reverse includes the images of Gniezno Cathedral and the royal chalice of Trzemeszno.
- zł20 is a banknote issued in 2017 that measures 144 mm by 72 mm. There is an icon of the Black Madonna of Częstochowa and also the Polish coat of arms on the obverse. The reverse features the Częstochowa landscapes.
- zł20 is a banknote issued in 2018 in violet and orange colours that features the portrait of Józef Piłsudski on the obverse and the Polish flag and coat of arms on the reverse. The note measures 150 mm by 77 mm.
The 19-zlotych note evokes the greatest interest because of its unusual denomination. It was issued in October 2019 and designed as a dedication to the composer Ignacy Paderewski. The obverse is of light green and blue background and features his portrait. The reverse includes the image of the Polish Security Printing Works building in Warsaw. The note measures 150 mm by 77 mm.
Fractional coins of Poland are minted by the Mint of Poland in nine denominations. There are six denominations for the groszy and three - for the zloty. The denominations of coins range from 1 to 50 groszy (1 gr, 2 gr, 5 gr, 10 gr, 20 gr, and 50 gr). Since 2017, the alloy material has become cheaper. The zloty coins are minted in denominations of zł1, zł2, and zł5.
The reverse of all coins features the value surrounded by the oak leaves.
Circulation in the World
Poland joined the European Union in 2004, but its transition to the common currency used to be postponed all the time. In 2016, the country’s government decided to refuse to introduce the euro because Poland was willing to keep its fiscal independence in the future. The zloty will remain the official currency of the republic in the foreseeable future.