It is reported that the government of Venezuela is planning to issue new high value banknotes this December.

The country’s economy has faced hyperinflation in recent years and it is forecast to reach 1,600% next year. The bolivar was revalued in 2008 at a ratio of 1 to 1,000, and the new currency, complete with a new family of banknotes, was renamed the ‘bolivar fuerte’, but hyperinflation has continued to afflict the country and push it towards its deepest recession in modern history.

The new family of banknotes are expected to include a new high denomination 20,000 bolivars banknote – quite a step up from the current highest denomination 100 bolivar. On the forex market the official rate is 1 bolivar to US 10 cents, but according to a recent article in the Wall Street Journal, on the black market 100 bolivars is now worth only eight US cents.

This is causing severe problems for even basic transactions, and banks are suffering with extensive money-handling costs.  According to the Venezuelan Banking Association, a fully stocked ATM is emptied within three and a half hours on average, as people spend hours queuing and reportedly leave with backpacks full of cash. This has forced many regional banks to reduce daily withdrawals to 30,000 bolivars, the of a lunch for two at a midrange restaurant.

Last year the Venezuelan government, having to deal with the extraordinary high demand for banknotes, paid millions of dollars to printing companies such as De La Rue, Giesecke & Devrient and Oberthur Fiduciaire to provide billions of notes. It is understood that Crane Currency will be involved in printing the 500 and 1,000 bolivar notes in the new series.