Inminban (neighborhood watch units) in Hyesan have recently been coaxing their members to exchange their foreign currency in banks, Daily NK has learned.
Speaking on condition of anonymity for security reasons, a source in Yanggang Province told Daily NK on Friday that “during meetings in mid-August, neighborhood watch unit leaders said individuals who are caught using foreign currency face confiscations, big fines and criminal punishments.”
The source said that the leaders urged people with dollars or yuan to “go to the bank and change them into won rather than suffer punishment and regret.”
People have long changed their money at private money changers to avoid uncomfortable questions from banks about the source of their money. However, the neighborhood watch unit leaders told people to use the banks with peace of mind as they “would never face” interrogations there.
The unit leaders also said banks offer better rates than private money changers, according to the source.
North Korean banks offer rates of KPW 1,260 to the yuan, while private money changers offer KPW 1,255. For dollars, banks offer rates of KPW 8,350, while private money changers offer KPW 8,320, a KPW 30 difference.
For example, if you were to change RMB 100 at a bank, you would receive KPW 126,000. However, through a private money changer, you would receive KPW 125,500, a difference of just KPW 500.
“Basically, people avoid changing money in banks because they’re afraid of coming to the attention of law enforcement after the transaction,” the source said. “Moreover, it’s only a KPW 500 difference for RMB 100, so who’s going to use the bank?”
With most people suffering economic hardships, even just eating non-glutinous rice puts people on a watchlist now, so nobody is going to go to a bank for a few extra won, the source said.
Police in Hyesan have been cracking down recently on professional money changers. The intensive crackdown appears aimed shrinking the currency exchange market with a view to force people to exchange their foreign currency at banks.
Although the authorities are using every means possible to make people conduct transactions at banks, “it won’t be easy to change the minds of people who have no trust or faith in the banks,” the source claimed.
Meanwhile, money changers busted in last month’s crackdown in Hyesan are yet to be released.
“In the past, they’d be released after two or three days, or a week at the latest, but this time, it’s been over 10 days and they’ve yet to be released,” the source said. “Given the circumstances, most money changers are laying low, with only a handful conducting transactions on the sly.”
Translated by David Black. Edited by Robert Lauler.
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