The Central Bank of Libya announced this week that it would be withdrawing five-dinar and ten-dinar bank notes from circulation as of Thursday, November 1.
The notes are part of the fourth and fifth series released by the country.
“The bank said it had decided to withdraw the notes ahead of issuing newly-designed five and ten dinar notes,” reported the Libya Herald. “Many have already been withdrawn. Those still in circulation tend to be battered and crumpled.”
Though the notes will be withdrawn next week, citizens will be able to exchange them with the Central Bank until December 31, 2012. “After that they become worthless paper, at best collectors’ items,” the Herald said.
In a statement, the Central Bank asked all commercial banks and their branches to allow the public to exchange banknotes or deposit them into their personal accounts, allowing for a smooth transition.
This isn’t the first time this year the Central Bank has decided to remove banknotes from circulation. In February, the bank began the process of withdrawing an old banknote series depicting the image of former Libyan leader, Muammar Gaddafi.
At the time, Saddeq Omar Elkaber, the governor of the central bank, said the goal of issuing a new banknote series in Libya wasn’t just to eliminate cash depicting the ex-head of state. It was also a way for the bank to help reinstate confidence in the Libyan banking system, which has suffered greatly due to civil war in the country.
During the conflict, Gaddafi’s regime depleted the banking system and seized 3-4 billion dinars from the central bank. As a result, Elkaber said, many citizens chose not to keep their money in banks.
“One of the biggest implications in the economy is the increase of the percentage of money in the market outside the banks which is in excess of 15 billion dinars ($12 billion) or 96 per cent of available money,” he told Reuters.