Taiwanese Currency

The New Taiwan dollar serves as the official currency of Taiwan. The primary denomination of the New Taiwan dollar is referred to as a yuan, which is further divided into ten chiao (角) or 100 fen (分), equivalent to cents. Despite the formal subdivisions, in practical terms, both chiao and fen are rarely utilized in daily transactions.

The historical evolution of currency in Taiwan is intricately tied to its past connections and economic influences. The roots of various Chinese and Japanese currencies, including the yuan and yen, trace back to the Spanish American silver dollar. This currency flowed into China via the Manila-Acapulco Galleon Trade from the 16th to the 20th centuries.

In 1895, following the use of the Spanish dollar and the silver Chinese yuan in Taiwan, the island introduced the Taiwanese yen. Subsequently, in 1946, the Old Taiwan dollar was established. However, facing hyperinflation due to the Chinese Civil War, the Bank of Taiwan issued the New Taiwan dollar on June 15, 1949, at a rate of 40,000 to one, with the primary objective of stabilizing the economy.

Amid the Nationalist retreat to Taiwan, the New Taiwan dollar became the de facto currency. The government, responding to the Communist Rebellion, declared the Bank of Taiwan-issued dollars as the new circulating currency. Despite this transition, statutes continued to recognize the silver yuan as legal currency, with an outdated value of NT$3. Over time, these legal provisions persisted, even though the silver yuan had become a symbolic currency without any tangible silver backing.

In 1991, when the Temporary Provisions became ineffective, Taiwan lacked a legal national currency until 2000. The Central Bank of China (CBC) took over currency issuance from the Bank of Taiwan, officially establishing the New Taiwan dollar as the legal currency in July 2000. The CBC initiated the issuance of new banknotes, replacing those previously circulated by the Bank of Taiwan.

The exchange rate of the New Taiwan dollar against the United States dollar has experienced fluctuations over the years. From less than ten to one in the mid-1950s, to more than forty to one in the 1960s, and approximately twenty-five to one in 1992. As of July 2021, the exchange rate stands at NT$27.93 per US dollar.

Yes, the terms "New Taiwan Dollar" and "Taiwan Dollar" refer to the same currency. The use of "New" in the currency's name was introduced in 1949.

In Taiwan, it is common for businesses and establishments to not accept foreign currencies such as Sterling or US dollars. Money changers are typically available at major hotels and banks, and it is advisable to exchange some of your money into New Taiwan Dollars (TWD) upon entering the country. For less common foreign currencies in Asia, it is recommended to utilize airport banks for currency exchange, as they often offer a more extensive range of currencies compared to other banks in Taiwan.