DEFINITION of 'NAD (Namibian Dollar)'

NAD is the abbreviation for the Namibian dollar, which is the currency of Namibia. This dollar is comprised of 100 cents, similar to the U.S. dollar. In most instances, the Namibian dollar is written with the $ symbol, or with N$ to make a distinction between it and other currencies with dollar denominations.

BREAKING DOWN 'NAD (Namibian Dollar)'

Prior to 1993, the South African Rand was the single, legal currency for the country of Namibia, which was ruled by South Africa as South-West Africa from 1920 until 1990. After gaining independence, the Namibia's currency largely shifted to the Namibian dollar. While the dollar is widely circulated, the Rand is actually still the legal tender in Namibia, because the dollar is pegged to the Rand at par. Residents use both currencies throughout the nation.

Replacing the Rand

A growing movement to replace the outdated South African Rand began in 1990. Because the Namibian dollar is connected to the Rand and has an exchange rate of one to one, the Rand remains the "legal" tender accepted in Namibia. Initially, in 1990, the proposed replacement currency for the country was the "kalahar," a name that reflects the Kalahari Desert, which sprawls across eastern Namibia. Officials drew up several designs for the kalahar and speculated on a range of denominations, but little developed from this.

The only replacement currency for the Rand that ever took shape, and exists today, is the Namibian dollar. This currency’s central bank, the Bank of Namibia, issued the first NAD banknotes in September of 1993, followed by the first coins that December.

Denominations

NAD coins in circulation exist in the amounts of 5, 10 and 50 cents, as well as coins that hold a value of 1, 5 and 10 dollars. There are banknotes in the amounts of 10, 20, 50, 100 and 200 dollars.

Practical Use

While the Namibian dollar is highly utilized in Namibia, it is not legally accepted in South Africa. Within Namibia, the NAD can be exchanged for the Rand without commission. A similar transaction in South Africa, while still able to be performed, generally incurs a weighty commission. In most cases, this commission is about 25%, as of 2016.

Highs and Lows

In terms of the exchange rate with the U.S. dollar, the NAD experienced its all-time low of 2.52 in November of 1990. The record high for the NAD exchange rate at the beginning of 2016 was 16.87.

RELATED TERMS
  1. USD

    The USD is the abbreviation for the U.S. dollar.
  2. USD (United States Dollar)

    USD is the currency abbreviation for the United States dollar, ...
  3. Hard Currency

    A hard currency is a system of money that generally comes from ...
  4. SZL (Swaziland Lilangeni)

    The Swaziland lilangeni is Swaziland's national currency. It ...
  5. Reciprocal Currency

    In the foreign exchange market, a currency pair that involves ...
  6. Exchange Rate

    An exchange rate is the price of a nation’s currency in terms ...
Related Articles
  1. Trading

    The New World Of Emerging Market Currencies

    Take advantage of foreign currency markets without stepping out of your house.
  2. Personal Finance

    5 Countries Where the USD Is Commonly Accepted

    In these five countries, the U.S. dollar is either the official currency or is used alongside native currencies for transactions.
  3. Trading

    The U.S. Dollar's Unofficial Status as World Currency

    Discover how and why the U.S. dollar emerged as official currency in many foreign countries.
  4. Trading

    Play Foreign Currencies Against The U.S. Dollar And Win

    Don't panic when the dollar drops. Learn to exploit the greenback's decline and profit from it.
  5. Trading

    Profiting From a Weak U.S. Dollar

    Learn how to allocate your investments when the U.S. dollar is down.
  6. Trading

    6 Top-Traded Currencies and Why They're So Popular

    Every currency has specific features that affect its underlying value and price movements in the forex market.
  7. Trading

    Dollarization Explained

    Find out how fledgling economies can find some stability in their currency and attract foreign investment.
  8. Trading

    Weakest Currencies against the U.S. Dollar in 2015

    The U.S. dollar has been pummeling other currencies, largely due to falling global commodity prices. Here are the worst performing currencies of 2015.
  9. Trading

    Drastic Currency Changes: What's The Cause?

    Currency fluctuations often defy logic. Learn the trends and factors that result in these movements.
RELATED FAQS
  1. How do national interest rates affect a currency's value and exchange rate?

    Generally, higher interest rates increase the value of a given country's currency, but Interest rates alone do not determine ... Read Answer >>
  2. What is foreign exchange?

    Foreign exchange is the conversion of a country's currency into another. In a free economy, a country's currency is valued ... Read Answer >>
Hot Definitions
  1. Internal Rate of Return - IRR

    Internal Rate of Return (IRR) is a metric used in capital budgeting to estimate the profitability of potential investments.
  2. Limit Order

    An order placed with a brokerage to buy or sell a set number of shares at a specified price or better.
  3. Current Ratio

    The current ratio is a liquidity ratio that measures a company's ability to pay short-term and long-term obligations.
  4. Return on Investment (ROI)

    Return on Investment (ROI) is a performance measure used to evaluate the efficiency of an investment or compare the efficiency ...
  5. Interest Coverage Ratio

    The interest coverage ratio is a debt ratio and profitability ratio used to determine how easily a company can pay interest ...
  6. Cash Conversion Cycle - CCC

    Cash conversion cycle (CCC) is a metric that expresses the length of time, in days, that it takes for a company to convert ...
Trading Center