EU Commission adopts proposal for conversion of hryvnia banknotes by people fleeing Ukraine

The EU Commission adopted on April 1, 2022, its proposal for a Council Recommendation on the conversion of hryvnia banknotes into the currency of host Member States by persons fleeing the war in Ukraine.

This proposal complements the humanitarian assistance provided by the EU to those fleeing from Ukraine, in particular as they travel across the Union, and it is fully consistent with the EU asylum acquis and with the Union’s external action.

Since the start of Russia’s military invasion of Ukraine, over 3.8 million people fleeing the war against Ukraine have arrived in the European Union. The EU and its Member States have made considerable efforts to provide humanitarian assistance and temporary protection for these people, including access to the labour market, housing, medical assistance and education for children.

One of the immediate needs of refugees is to convert their hryvnia banknotes into the currency of their host country. Today’s proposal aims to promote a coordinated approach for all Member States to offer those fleeing from Ukraine the same conditions for converting their hryvnia banknotes into local currency independently of the Member State that hosts them.

This approach was necessary in light of the fact that the National Bank of Ukraine had to suspend the exchange of hryvnia banknotes into foreign cash in order to protect Ukraine’s limited foreign exchange reserves. As a consequence, credit institutions in EU Member States have been unwilling to carry out the exchanges due to the limited convertibility of hryvnia banknotes and exposure to exchange rate risk.

Some Member States are considering putting in place national schemes that support the conversion of a limited amount of hryvnias per person, and the Commission’s aim is to promote a consistent approach to such schemes. The schemes should provide for maximum limits of 10000 hryvnias per person, without charges, at the official exchange rate as published by the National Bank of Ukraine. The duration of the schemes should be for a minimum of three months.

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