Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

New Ruble Gets a Quiet Reception

Central Bank officials were wiping the sweat from their collective brow Monday amid signs that the ruble's much-dreaded redenomination was off to an uneventful start with the new year.

Across Moscow, a populace shrugged off the change that officially lopped three zeros from the national currency, and hardly a new note could be found as the city's bankers continued doling out the old rubles, uninspired by the Central Bank to make a hurried switch.

Plans for the redenomination were announced by President Boris Yeltsin in August. Since then, the government has taken pains to convince a reform-weary public that, unlike two previous banknote changes in 1991 and 1993 that led to mass confusion and lost savings, no one would lose anything this time round.

Yet despite a large-scale television advertising campaign aimed at assuaging the public's fears, uncertainty persisted until the final days of 1997, and hard-currency purchases by Russian savers gave rise to fears of a run on the ruble.

Instead, 1998 arrived to find patient acceptance among people on the street.

"It is just a matter of getting used to new notes without zeros, just as we had to get used to notes with a lot of zeros," said Yury, an apartment repairman walking his 4-year-old son, Misha. He added, however, that his wife, Galina, was panicky over how she would handle the different denominations when she reported for work at a store.

"Not to worry," said one woman working in a small convenience store after a day of successfully dealing with new notes alongside the old ones. "You only need to hold them in your hands for a while [to become confident]."

Natalya Sergeyevna, a retired physician, said although everything was going smoothly now, she foresaw problems should vendors start refusing to accept old money. "They have already been refusing to accept the existing 50 ruble coins," she complained.

Not that many vendors or patrons have had an opportunity to even see the much-touted new ruble -- many banks have been slow to place orders for the new bills.

"It does not matter to us whether we deal in old or new rubles," said Tokobank spokesman Alexei Chernyshev. "Especially as only about one-hundredth of the bank's transactions involve the actual use of cash."

One area that still needs addressing lies in the stock market, where hundreds of millions of shares continue to carry a face value denominated in old ruble terms. Although the government is preparing a resolution to carry out changing the par values, traders said Monday that there is no affect on stock prices, which exchanges quote in dollars.

For its part, the Central Bank is standing by its policy to naturally "wash away" old rubles for new ones, a process identical to the routine replacement of old, dilapidated banknotes for crisp new ones, said bank spokesman Alexander Vikhrov. If there is a sudden demand for new notes, the bank is ready, he said.

"The new money was distributed to ... payment centers all across Russia," Vikhrov said. "If all the banks for some reason wanted to get all this money, it would not be a problem for us."

In the meantime, the Central Bank is giving commercial banks until July 1 to hand out old and new notes alike, after which only new bills can be put into circulation. Old and new bills both will be legal tender throughout 1998, after which it still should be possible to exchange the old notes for new at designated banks until the year 2002.

The Central Bank insists, however, that at least 2 percent of currency orders from the Central Bank be for small-denomination coins. Mandating their circulation is serious business because it is hoped to prevent merchants from rounding prices up.

But despite the changes and any hint that the cost of bread could rise from 2.80 rubles to an even 3 rubles, one seventh grader saw the switch as definitely a change for the better.

"Fewer zeros," said Vanya, who does not remember life without the many-zeroed bills, "less confusion."