Peter Symes
The paper currency issues of Saudi Arabia are excellent examples of the development of paper money in the modern Islamic world. With the issues being only forty years in existence, they show development from peculiar beginnings – as receipts for pilgrims to Mecca and Medina – to modern notes which are amongst the most technically advanced.
Before we have a look at the note issues, it is worth delving into the history and culture of the Saudi Kingdom to gain an essential insight into the development of paper currency in that country.
Islam – the religion of the Arab nations – decrees that "things exchanged shall be of equal value", and so for centuries commerce was conducted using gold and silver as the medium of exchange. The gold and silver was not debased in anyway, and thus an "equal" value of gold or silver was exchanged for goods at an agreed price. With this economic dictum it is impossible for a substitute such as paper money to be used, as the paper is intrinsically worthless.
An interesting insight into the Arab isolation from paper money is given by Lawrence of Arabia in his account of the Arab revolt against the Turks in 1916 (Lawrence, T.E., Revolt in the Desert, Jonathan Cape, London 1927):
"The notes we had issued at Bair, Jefer and Guweira were pencilled promises, on army telegraph forms, to pay so much to the bearer in Akaba. It was a great system, but no one had dared issue notes before in Arabia, because the Beduins had neither pockets in their shirts nor strong-rooms in their tents, and notes could not be buried for safety. So there was an unconquerable prejudice against them, and for our good name it was essential that they be early redeemed."
The revolt that Lawrence encouraged was raised in the Hedjaz, which was a dependency of the Turks until after the revolt, when it became a Kingdom in its own right. The Hedjaz occupies a 1,300 kilometre coastal strip between Nejd and the Red Sea, and contains the holy cities of Mecca and Medina.
The coastal position meant that a great deal of trade was carried out with foreigners, and the location of the holy cities meant that a great many pilgrims arrived from foreign countries. This movement of people and activity in trading meant that there was also a great deal of foreign currency circulating in the main ports and cities.
Whilst there was a lot of coinage consisting of base metal, there was also the paper currency of many nations which the merchants came to trust. This familiarity and trust of paper money lead to the issue of five notes by the Arabian National Bank of Hedjaz in 1924. The notes issued were: ½ pound, 1 pound, 10 pounds, 50 pounds and 100 pounds.
This issue is now quite rare as it was extremely short lived, for in 1925 Abdul Al-Aziz Ibn Sa'ud of Nejd conquered the Hedjaz and annexed it to his other possessions to form the Kingdom of Saudi Arabia.
The house of Sa'ud was less influenced by foreign powers – particularly Britain – than were the overthrown rulers of the Hedjaz, and they were more aligned to traditional Islamic customs. In particular they insisted on currency minted with base metals and the main circulating coinage in Saudi Arabia at this time were base metal coins – such as the Maria Theresa dollar.
The Saudi quest for national currency began in 1925 with the issue of the cupro-nickel qirsh, and followed in 1927 with the silver riyal. However whilst coins were minted, paper money was never considered a viable proposition for this very Muslim country – because of the Islamic teaching that only things of equal value should be traded (or exchanged).
Apart from the need to exchange things of equal value, Islamic doctrine also forbids the charging of interest on loans ("Allah has permitted trading and forbidden usury" [Koran 2:275]) which subsequently means that it is very difficult for a bank to survive – as it loses its prime source of income. The fate of the Arabian Bank of Hedjaz is unknown, but until 1948 there was only one bank in Saudi Arabia – the Netherlands Trading Society, which was established in Jiddah in 1926.
The lack of a central bank in Saudi Arabia meant that as the nation developed a modern complex economy, serious pressures were placed on the machinery of government as well as the economy. By 1951 the government realised it had to establish an orderly monetary system along with the necessary supporting mechanisms.
In 1952 the Saudi Arabian Monetary Agency (SAMA) was established – its charter was to hold the nation's monetary reserves, advise the government on the issue of coinage, purchase and dispose of base metals for the government, and regulate commercial interests in the country. SAMA was expressly forbidden to lend money (even to the government), to pay or receive interest, and (notably) to issue paper money.
However, there was a real crisis that SAMA had to face – Saudi Arabia was losing its silver! Due to the fluctuations in silver prices, the content of the silver riyals often exceeded the rate of exchange, and the riyals were finding their way to the bullion market. Coupled with this was the seasonal influx of pilgrims which demanded an increase in coins – and the merchants had to bear the costs incurred in carrying these extra coins.
SAMA quickly found the solution, and in 1953 the first "pilgrim receipts" were issued – these were 10 riyal promissory notes and as a promissory note they could be exchanged for silver riyals. SAMA had circumvented the actual issue of "bank notes" but managed to issue paper currency which quickly became widely accepted. Not only were they more convenient to carry, but they also filled a gap in the Saudi currency system as until this point there was no denomination between the 1 riyal coin and the 40 riyal sovereign.
During the 1950's the Saudi economy went through drastic changes – burgeoning foreign debt and inflation were destroying the country. Although there were a number of economic circumstances which lead to debt and inflation, one of the contributing factors was the increased production of pilgrim receipts – but now without the necessary backing of silver riyals.
In 1955 the government succumbed to economic pressures of the time and removed two of the constraints originally imposed on SAMA – these being the prohibition on issuing paper money and the lending of money to the government. This action saw the situation become even more severe and coupled with the other economic factors it was apparent that the economy of Saudi Arabia was disintegrating.
By 1958 King Faisal saw that desperate measures had to be taken to reverse the decline. With the aid of economic experts he attempted to balance national spending and income, pay off the national debt, control inflation, and stabilize the riyal – all without disrupting normal business.
With the personal weight of the King behind the reforms and some carefully planned policies, the economy quickly began to respond. By the early 60's the concerted effort by the Saudis had brought very real results, and by the end of the 60s the Saudi economy was one of the healthiest in the world.
Part of the controls introduced during the period of reform was the issue of paper money and the withdrawal of pilgrim receipts. A series of five notes – one, five, ten, fifty, and one hundred riyals – was introduced in 1961, and the issue was backed by a one hundred per cent reserve of gold and convertible foreign exchange. The pilgrim receipts were recalled in October 1963 and demonetised on the 20th March 1964.
Since that first issue of bank notes there have been three subsequent issues, all of which will be described shortly. But before the description of the issues is undertaken, it is necessary to mention a little about the modernization of Saudi Arabia as well as its religion – as so many of the images portrayed on the notes are related to these two subjects.
Saudi Arabia (as mentioned earlier) was founded by Abdul al-Aziz ibn Sa'ud in 1925, and at that time it was a collection of mostly nomadic tribes and a few cities. One of the remarkable achievements made by the Saudis is the modernization of their country – an achievement of which they are justly proud. They are of course very dependant on oil revenues, but are using these revenues to educate their people and develop their country. They lead the world in desalination technology, they are building large farming communities and irrigation systems, and are developing industries. Many symbols of progress and development are to be found on the bank notes.
Modernization, coupled with the wealth of the Kingdom, has placed Saudi Arabia as one of the leading Arab nations. But it is not only for these reasons that Saudi Arabia is well regarded in the Arab world – the Saudis are also protectors of the birthplace of Islam.
Islam dominates the culture of Saudi Arabia and permeates every part of their life. Not only are they proud Muslims, but they also take pride in looking after the treasures and holy sites of their religion, indeed one title held by King Fahd is "Custodian of the Two Holy Mosques".
The two mosques are the "Holy Mosque" in Mecca and the "Prophet's Mosque" in Medina, and the significance of the mosques can be gauged by the fact that they have been depicted on the two highest denomination bank notes of the last two issues. The Holy Mosque is where the Ka'aba is located, and is regarded as the most holy of all shrines. During the pilgrimage – or "Hajj" – undertaken by Muslims it is necessary to circumambulate the Ka'aba which is in the central courtyard of the mosque. Another requirement of the pilgrimage is to perform the ritual of the Mas'a – or "running place" – between Alsafa and Almarawa. To facilitate the performing of the Mas'a an extension to the mosque has been made allowing pilgrims to make the walk without leaving the precincts of the mosque.
Recent expansion of the Prophet's Mosque has also been undertaken, allowing a greater access for more pilgrims. It is in this mosque that the body of the prophet Muhammad lies. Another site which is of significance to the Muslims is Mt. Hara which is two miles outside Mecca – it was in a cave in this mountain that the Prophet first spoke with the archangel Gabriel. There are a number of other significant sites and mosques which are too numerous to elaborate on in this article – some of which are depicted on the notes – and they really require a separate study.
The last item to mention before we describe the notes, is the emblem of two crossed swords and the date palm which appears on all the Saudi notes. This is the Emblem of the Kingdom of Saudi Arabia, where the two crossed swords indicate justice and strength, and the palm date tree placed immediately above the swords is a symbol of abundance and development.
The receipts are green and have the emblem of Saudi Arabia (the date palm and crossed swords) displayed prominently on the front of the note. Also on the front are three sections of Arab script – one to the left, one to the right, and one above the date palm. The script above the date palm reads "Saudi Arabian Monetary Agency", and the other two can be translated as follow:
(on the left) "I declare that the Monetary Agency has in its vault the amount of ten Arabic riyals available for whosoever holds this receipt, it is negotiable, and the full value of this receipt will be given immediately to the holder in any of the Monetary Agency branches. First issue 1372."
(on the right) "This receipt was issued by the Agency to facilitate the carrier's pilgrimage and therefore allows him to get the Arabic Riyal in his hands with ease during his stay in Saudi Arabia, and without him incurring any exchange fees."
At the lower front the value of the receipt (10 riyals) is written in six languages – to be understood by as many pilgrims as possible. The languages are: English, Arabic, Urdu, Farsi (Persian), Swahili, and Turkish. Below this writing the receipts carry the English inscription: "The Saudi Arabian Monetary Agency holds in its vaults ten riyals at the disposal of the bearer of this fully negotiable receipt". This inscription is repeated in the five remaining of the previously mentioned six languages on the reverse of the receipts.
The denomination is written in Arabic numerals at the top right and top left, and in western numerals at the bottom right and bottom left – this format being repeated at the back of the note.
The immediate success of the receipts lead to a second issue of five and ten riyal receipts in 1954 and a one riyal receipt in 1956. The one riyal receipt has a red front depicting the entrance to the palace of King Saud bin Abdul Aziz in Riyadh and a brown back that carries the Saudi emblem.
The five riyal receipt is blue and multicoloured and includes a panorama of the harbour at Jiddah, with a dhow in the foreground. The ten riyal receipt is similar in design, but is green and multicoloured; and whilst it has the same picture of the harbour at Jiddah, instead of one dhow in the foreground it has two. The reverse of all receipts in this series have patterned backs that include depictions of the Saudi Emblem.
Common to the front of all three receipts is the Arab script which also appeared on the original receipts – the name of the Agency, the declaration of negotiability, and reason for issue. Also common to the three notes is the notification that the Saudi Arabian Monetary Agency holds the necessary amount of riyals for the redemption of the receipt. It is found in English at the bottom front of the note, and repeated on the reverse in the five languages that were used on the original receipts.
All receipts of this series were print on paper that included watermarks of SAMA's monogram, and a silver security thread. The use of silver in the security thread linked the receipts to the silver standard that existed in the Saudi coinage, and gave an indication of the strength of the currency.
The one riyal note is brown with a picture of Mt. Hara in the centre; the five riyal note is blue and green with a picture of an ancient city wall; the ten riyal note is green and pink with a panorama of the harbour at Jiddah; the fifty riyal note is violet and olive with the depiction of an oil derrick; and the one hundred riyal note is red and depicts the Royal Palace with an archway in the middle distance.
All notes of this series were printed on paper containing a silver security thread and a watermark of the Saudi emblem, which is also included as the dominant design on the reverse of each note. Also common to all notes of this series are the inscriptions on the front and back of the notes. On the front, the name of the Saudi Arabian Monetary Agency appears in the top border and immediately below this is a statement indicating that the notes are issued by a decree dated 1/7/AH1379. To the left of the notes is a promise to pay the bearer of the note the number of riyals according to the denomination. The denomination of the notes is written in Arabic numerals on all four corners of the notes and in Arabic at the bottom of each note.
On the back of the notes, below the Saudi emblem is the following text in Arabic:
"This note was issued during the reign of His Majesty King Saud bin Abdul Aziz al Saud, King of Saudi Arabia".Also on the back of each note is the denomination written in English at the centre right and in western numerals at the bottom left and bottom right.
The second issue of bank notes was made in 1966 and consisted of the same denominations as the first issue. Each note of the second series is printed on paper with a silver security thread and a watermark of the Saudi emblem.
Again the Arabic inscriptions are common to all notes. The Saudi Arabian Monetary Authority is written in a decorative panel at the top on the front of the note, and below in ornate Arabic script is the notification that the note was issued by decree dated 1/7/AH1379 and issued during the reign of King Faisal Abdul Aziz al Saud. There is also an inscription which is a promise by the agency (SAMA) to pay the bearer the relevant number of riyals on request.
For the one, five and ten riyal notes the denomination appears in Arabic numerals at each corner on the front of the notes, and the denomination is written in full at the bottom. For the fifty and one hundred riyal notes the denomination appears only in the top left and bottom right corners. These details, along with the "Saudi Arabian Monetary Agency" appear on the reverse of the notes in English.
The one riyal is predominantly purple with the Foreign Affairs building in Jiddah on the front and a patterned reverse which includes the Saudi emblem. The five riyals is green with Dhahran airport depicted on the front and Damman sea port on the back. The ten riyal note is blue with the Holy Mosque on the front and the wall of the Mas'a extension to the Holy Mosque illustrated on the reverse. The fifty riyal note is predominantly brown with the courtyard of the Prophet's Mosque shown at the right on the front and a date orchard shown on the reverse, as well as the Saudi emblem. The one hundred riyal note is red with the Royal Palace on the front and an oil refinery on the rear.
In 1977 the third issue was made and the common link with each note in this series is the portrait of King Faisal (who died in 1975) on the right of each note with the image of the portrait being repeated in the watermark at the left. The exception is the one hundred riyal note where the portrait and watermark is of King Abdul Aziz ibn Sa'ud – the founder of Saudi Arabia.
The inclusion of portraits on this issue is an interesting addition as the depiction of human forms is generally frowned on in the Muslim world. Whilst not forbidden by the Koran, there is a fear that the depiction of human forms may lead to hero or saint worship.
Each note has the usual security thread and inscriptions which are common to all notes. The name of the "Saudi Arabian Monetary Agency" appears in the top centre on the front of the note and is flanked by two panels of ornate Arab script. To the left is the notification of the decree under which the notes are issued and that they were issued during the reign of King Khalid Abdul Aziz ibn Saud. To the right is the promise to pay the bearer the amount for which the note is issued.
The denomination of the notes appears in Arab script at the bottom centre of the notes, and in Arab numerals in each corner on the front of the notes. The serial numbers are printed in the top right and bottom left on the face of the notes. The rear of the notes has the "Saudi Arabian Monetary Agency" and the denomination of each note written in English, and the denomination of each note appears in western numerals in each corner.
The one riyal note is predominantly red, with Mt. Hara on the front of the note and Dharan Airport on the reverse. The five riyal note is green and brown with an irrigation canal from the Hasa Irrigation project (in the east of the Kingdom) on the front and Jezran Dam (in the south) on the back of the note. The ten riyal note is pink and brown and has an oil derrick on the front and an oil refinery on the reverse. The fifty riyal note is green, pink and brown with a depiction of a courtyard of the Prophet's Mosque with arches and columns on the front and and on the back is the courtyard repeated from another angle. The one hundred riyal note is pink and blue and has a picture of the Holy Mosque on the front of the note, and the facade of the Mas'a extension to the Holy Mosque on the back. Each of the five notes has the Saudi emblem on the rear, at the left of the note.
The fifty and one hundred riyal notes carry a number of designs that are registered perfectly on the front and back of the notes. This is the first proper use of perfect registration on Saudi notes, although the borders of the five and ten riyal notes of the previous issue did have patterns that came close to perfect registration.
The five riyal note of this series has two varieties: with the Arabic word for "five" being spelt correctly, and with the word spelt incorrectly – the correct spelling is the most common variety.
The fourth and final series was issued in 1984. The five hundred riyal note has the portrait of Ibn Sa'ud in the centre whilst the other denominations have the portrait of King Fahd in the centre. One interesting aspect of the portraits of King Fahd is that each portrait is slightly different, with the exception of the one and five riyal notes where the portraits are the same.
This series has only two Arabic inscriptions on the notes. The "Saudi Arabian Monetary Agency" appears in a panel at the top left of the notes; and the notification that the note is issued by the decree of 1/7/AH1379 in the reign of King Fahd bin Abdul Aziz, is printed at the top right below the serial number. Missing from this issue is the inscription promising to pay the bearer.
The denomination of the notes appears in Arab numerals in three corners (excluding the top right) and is written in Arabic below the portrait of King Fahd. The rear of the notes have the "Saudi Arabian Monetary Agency" and the denomination of the note printed in English, with the denomination appearing three times in western numerals.
The one riyal note is brown and multicoloured with a 7th century gold dinar (the first Islamic dinar) at the left, and a desert scene on the rear. The five riyal note is violet and multicoloured, having an illustration of three dhows on the front and the oil refinery at Ras Tanura on the rear. The ten riyal note is black, brown, orange and violet with Al Masmaq Palace (also described as Murabba Palace) in Riyadh on the front and a date grove on the reverse. The fifty riyal note is blue, black, brown, green and gold with Al-Qudes Mosque (located in Palestine and also called "The Dome of the Holy Rock") on the front and Al-Aqsa mosque in Jerusalem on the reverse. The one hundred riyal note is brown, green and violet with an illustration of the Prophet's mosque on the back, with a detail of the same mosque on the front. The five hundred riyal note is multicoloured with an aerial view of the Holy Mosque on the rear, and a detail showing the Ka'aba in the courtyard of the Holy Mosque on the front of the note.
The most interesting aspect of the fourth series is the introduction of modern security features, and the various varieties that exist in notes of this issue. The old security features are maintained, with the watermark – now of King Fahd – and the security thread still prominent; however the silver thread now has the letters "SAMA" microprinted on it. Perfect registration is continued from the last series, with all notes having perfectly registered patterns on the right and left sides of the notes.
Introduced into this series are new security features of fluorescent inks and latent images. When the notes of this issue are held under ultraviolet light an image of the King appears in gold ink to the left of the portrait, except in the one hundred and five hundred riyal notes where it appears to the right. As with the portraits, each image in fluorescent ink is slightly different – matching the intaglio image on the centre of the note. Other fluorescent features are the red serial number which turns to gold in the lower denominations and glows red in the one hundred and five hundred riyals, the signatures which turn dark green, and the blue fluorescent fibres – all becoming apparent under ultraviolet light.
In each note the value of the denomination is held in a latent image at the top of the notes, above the king. When the note is held at a very low angle – almost horizontally – the image can be detected in the intaglio printing. Whilst holding this angle, two very fine white lines (three lines on the one hundred and five hundred) can also be seen at the left of the portrait of the King in the intaglio printing surrounding his image. When viewed face on, these lines seem to disappear.
The third latent image occurs only on the one hundred and five hundred riyal notes, where there is a metal panel with an "integrated double image". When viewing the panel from one angle, the Saudi emblem can be seen in the panel, and when viewed from a different angle the name of H.M. King Fahd ibn Abdulaziz appears in Arabic on the one hundred riyals and the name of Abdulaziz Al-saud on the five hundred riyals.
The varieties of the fourth issue fall into three sections. The first variety to be discovered was the misspelling of "Five Hundred Riyals" on some of the notes of that denomination. This error seems to have been rectified, and both varieties are common.
The second variety is the absence or presence of an accent over the Arabic word for "Monetary" in the banner at the top left of each note. The accent is not used in modern Arabic, except for decoration in a formal document, and it was obviously considered inappropriate in this issue as the latter notes of all denominations lack the accent. Again, both varieties are common.
The third variety currently appears only on the one riyal note, but will probably occur on all notes over time. Originally the left hand signature was designated as belonging to the acting Governor of SAMA, but in the latest issue of the one riyal note the "acting" status has disappeared.
To confuse the issue, it appears that the one riyal notes with and without the accent over the word "Monetary" also appear with and without the designation of "acting" Governor.
This brings us to the end of our description, but there remain two points open for discussion.
The collecting of the full series of Saudi bank notes is very achievable, even though some notes are difficult to come by. It is certainly a series with a story and will be a asset to any collector's accumulation of world bank notes.
For anyone interested in the history of the Saudi economy and their currency, an article by Thomas W. Shea entitled "The Riyal: a miracle in money", published in the ARAMCO World Magazine (January – February 1969) is highly recommended. This article is indebted to it for many references.
I would like to acknowledge the assistance given by the staff of the Embassy of the Kingdom of Saudi Arabia in Canberra for identifying various scenes on the notes, and Mr Ashraf Atteia for the translations from the Arabic.
This article was completed in August 1993
© Peter Symes