CHF - Swiss Franc

Swiss Franc – Information on the Swiss Franc

The Swiss franc is the primary currency in Switzerland and the neighboring country of Lichtenstein. Many people confuse the Swiss franc with the French franc, which had been legal currency in France for centuries. When France decided to join the Eurozone and adopt the currency known as the Euro, it stopped making French francs and discontinued the franc as a form of legal tender. This left the Swiss franc as the only franc being made and used in the world. Switzerland is not one of the 17 nations of the Eurozone. The ISO 4217 code for the Swiss franc is CHF. It is issued by the Swiss National Bank. The currency converter from the franc to the Euro shows that the Euro holds a slightly higher value than the franc. It has a sub-denomination of 1/100 that goes by several names including Rappen, centime and rap.

History

The Helvetic Republic is what brought order and rule to Switzerland in 1798. Prior to the Helvetic Republic, there were over 75 entities manufacturing and issuing currency in Switzerland. The result was nearly 900 different coins being circulated that had a different value from city to city. In 1798, the Helvetic Republic unified the Swiss currency using the French franc as a model.

In 1803, the Helvetic Republic ended and so did its version of the franc. But the idea behind the franc remained in Switzerland for many decades. When the Helvetic Republic ended, the flow of different kinds of currencies started up again. Each region and, in some cases, cities within Switzerland started to mint their own currency. When the currency being brought in from foreign countries was taken into account, it was estimated that there were over 8,000 different kinds of coins being used as currency in Switzerland from 1803 to 1850.

In 1848, Switzerland moved towards a policy of unity and adopted the Swiss Federal Constitution. In this constitution, it was stipulated that only the federal government was allowed to mint currency for Switzerland. To help develop a unified system of currency, the Swiss Federal Coinage Act of 1850 declared that the franc would be the official currency of Switzerland. As with the Helvetic Republic, this version of the franc would be based on the French franc with the Swiss franc being given sub-denominations of 10 batzen and 100 rappen.

In 1945, Switzerland tied its franc's value to the value of the American dollar through the Bretton Woods system. The franc's value itself was tied to its composition of gold and silver. But the value on the international market is tied to the performance of the US dollar and the Euro.

Facts

• Despite popular international misconception, the Swiss franc is issued as a coin and on paper.
• Most people perceive the franc as only being a coin. This has not been true for a very long time.
• The Swiss franc can either be made up of 4.5 grams of silver or 0.290322 grams of gold.
• Unlike most currencies, the Swiss franc has several versions of the plural of its name.
• In some cases, the plural of the Swiss franc name depends on what country you are in. The most common plurals of the Swiss franc are:

• Franken (German)
• francs (France)
• franchi (Italy)
• Rappen (German)
• raps (Romania)

• While the official ISO 4217 code for the Swiss franc is CHF, many international companies use the designation of Fr or SFr in their advertising and even in their accounting papers.
• The reason that the Swiss franc has been associated in popular culture with being a safe form of currency is because the franc has hardly ever been affected by inflation and it was protected by a Swiss law which stated that 40 percent of the value of all francs must be backed by gold. On May 1, 2000, the gold backing law was repealed and the Swiss sold off much of its gold. But the franc is still backed by 20 percent of its value in gold in Swiss bank vaults.

Nicknames

Because the Swiss franc is used by so many neighboring countries, it has developed a lot of nicknames. Some of the more common money nicknames for the Swiss franc include:

• Stutz
• Frankler
• Liiber
• Balle
• Thune

Regions

The Swiss franc is the primary form of currency for:

• Switzerland
• Lichtenstein
• Campione d'Italia

The Swiss franc is used in other parts of Europe as unofficial currency. Some of the areas that utilize the franc include:

• Romania
• Busingen am Hochrhein