What is the 'MAD (Moroccan Dirham)'

The Moroccan Dirham (MAD) is the national currency of the Kingdom of Morocco and the de facto currency of the Western Sahara region. The Bank al-Maghrib, Morocco’s central bank, controls the issue and circulation of the Moroccan dirham.

 It is made up of 100 santimat. Modern language often refers to five santimat as a rial and one santim as a franc.

BREAKING DOWN 'MAD (Moroccan Dirham)'

The Moroccan dirham is the contemporary evolution of an ancient form of currency. In pre-Islamic times, the dirham saw use in Arabia, while the Levant, saw use in a large area in Western Asia, bounded by the Taurus Mountains and the Arabian Desert. Like the ancient currency first circulated here, the region which includes Morocco is has seen human habitation for tens-of-thousands of years.

The Kingdom of Morocco, located in Northwest Africa is a prominent regional power. The founding of the first nation-state came in 788 A.D., and the area saw a series of independent dynasty rulers. The area was one of the few to avoid Ottoman rule. In 1912, the area split into Spanish and French protectorates but regained independence in 1956. The King of Morocco has legislative and executive control over monetary policy, as well as religious, and foreign policies. He rules through an elected parliament. 

In 1777, Morocco recognized the U.S. as an independent nation, the first nation to do so. In the early 1800s, the Moroccan area became colonized by France and later saw Spain declare an interest. By 1904, tensions between the two European nations rose and continued until a treaty in 1912. The region remained unsettled for many years, with fighting between French, Spanish, and indigenous groups of peoples. The press for independence grew and saw realization beginning in 1956. 

Attempts to depose the King have failed, and the country remains a constitutional monarchy. Demonstrators, including some during the Arab Spring uprisings, continue to push for reform and to lessen the power of the King. Morocco is a United Nations member, as well as being a member of the African Union, and Arab League. The nation continues to have strong ties to Western powers. 

According to World Bank data, Morocco has a highly educated population. The prosperous country experiences no annual inflation and has a gross domestic product (GDP) growth of a 4.1%, as of 2017, which is the most current year of available data.

History of the Moroccan Dirham (MAD)

While the Moroccan dirham is the official currency of the country and the rial is no longer in circulation, it is still sometimes referred to in colloquial language. In specific contexts, most notably when buying vegetables in marketplaces, prices will still be quoted in rials. In this regional context, one dirham will equal 20 rials. The primary use of the term rials is when prices are very low or very high. Instead of quoting a price for monthly rent as 1,000 dirhams, for example, the cost may alternatively be phrased as costing 20,000 rials. This usage is slowly dying out, as it was more common among older Moroccans, alive during the colonial period, and is not as prevalent among younger people.

he introduction of modern coins made out of copper, silver, and gold came in 1882. Silver coins were called dirham. Also in 1882, the Moroccan rial became the country’s official currency. One rial divides into 10 dirhams or 50 mazunas. In 1912, when most of Morocco became a French protectorate, the Moroccan franc replaced the rial. In Spanish Morocco, the rial replacement was the Spanish peseta. Morocco independence began in 1956 and included the reintroduction of the dirham. However, the franc remained in circulation until the santim replaced it in 1974.

The Moroccan dirham comes in both coin and banknote forms. The banknotes have denominations of 20, 50, 100 and 200 dirhams. The coins have smaller denominations of ½, 1, 2, 5 and 10 dirhams. The 1, 2, 5 and 10 dirham coins feature an image of the King of Morocco, Mohammed VI on the obverse and the inscription “Kingdom of Morocco” on the reverse.  Older coins may include a picture of the previous king, Hassan II, on the obverse.

The most recent series of banknotes, issued in August 2013, features a portrait of King Mohammed VI and the royal crown. The notes also include an image of a Moroccan doorway, as a nod to the country’s architectural heritage and a symbolic reference to its openness.

  1. IRR (Iranian Rial)

    IRR is the abbreviation for the national currency of the Islamic ...
  2. Oman Rial - OMR

    The currency of Oman. The Omani rial is broken into smaller units, ...
  3. French Franc (F)

    The French Franc (F) was a national currency used in France, ...
  4. Currency in Circulation

    Currency in circulation refers to physical forms of money that ...
  5. Currency

    Currency is a generally accepted form of money, including coins ...
  6. Quid

    Quid is a nickname for the British pound, also called the pound ...
Related Articles
  1. Trading

    Top Exchange Rates Pegged to the U.S. Dollar

    From the end of World War II until around 1971, all countries in the IMF pegged their currencies to the U.S. dollar. Today, many still do.
  2. Trading

    History Of Coinage In The U.S.

    From the barter system to commemorative coins, we look at the history of U.S. money.
  3. Insights

    Are $1 Coins A Better Option Than $1 Bills?

    We look at how much the government could save if it took $1 bills out of circulation.
  4. Trading

    The 6 Strongest Currencies Vs. The U.S. Dollar in 2016

    Learn about the world currencies that are stronger than the U.S. dollar, as of February 2016, as well as which factors have contributed to the dollar's strength.
  5. Insights

    What is Money?

    Money: It's a part of everyone's life, and we all want it, but what is it, how does it gain value, and how it was created?
  6. Insights

    Understanding The Currency Board vs Central Bank

    Each is different in their own way, but which system is better: the currency board or the central bank? Find out more about these systems in this article.
  7. Trading

    A Primer On Currency Regimes

    Currency regimes are dynamic and complex, reflecting the ever-changing landscape of their respective nations' monetary and fiscal policies.
  8. Insights

    Why These European Countries Don't Use the Euro

    The euro is a common currency of the European Union. Yet, many EU countries don’t use the euro. Investopedia explores why.
  9. Trading

    Forex Exotic Currency Trading: Risks & Rewards

    Exotic currencies are off the beaten path and are not for novices, but experienced forex investors might find the high risk-reward potential exciting.
  1. Is there a world currency? If so, what is it?

    There is no such thing as a world currency. However, since World War II, the dominant or reserve currency of the world has ... Read Answer >>
  2. When did the U.S. start using paper money?

    The roots of paper money in the U.S. dates back to the 1600s in Massachusetts, when the pioneering colony printed bills and ... Read Answer >>
  3. Who decides when to print money in the U.S.?

    Learn the U.S. Treasury's Federal Reserve Bank's roles in the process of printing money in the United States. Read Answer >>
  4. How do national interest rates affect a currency's value and exchange rate?

    Generally, higher interest rates increase the value of a country's currency and lower interest rates tend to be unattractive ... Read Answer >>
Trading Center