Iraq plans to remove three zeros from the dinar and introduce redesigned banknotes, in a redenomination intended to rebrand the currency and push more transactions into the formal banking system, a member of parliament's finance committee said, The New Region reported on August 24.

The overhaul, which would turn IQD1,000 into a single dinar, marks Baghdad's most concrete move yet on a reform floated for over a decade, and comes as the government of Prime Minister Ali al-Zaidi works to end the parallel market in dollars and curb cash circulating outside the banks.

Jamal Kocher, a Kurdish member of the finance committee, said al-Zaidi had requested the removal of the zeros, meaning IQD1,000 would become one dinar and IQD25,000 would become 25 dinars.

Communications Minister Mustafa Sanad confirmed earlier in August that the decision to remove the zeros and change the currency had been taken, Kocher said. The Central Bank of Iraq has yet to announce a formal timetable for the process.

Iraq added zeros to the dinar when it was heavily sanctioned towards the end of Saddam Hussein's rule, Kocher said, describing the addition of zeros as a sign of currency degradation.

He said some neighbouring countries had taken genuine Iraqi banknotes and returned copied versions, and that the market needed smaller denominations equivalent to cents.

The change also aims to curb cash held outside the banking system, which Kocher said could be used for crime and corruption. "Any crime that is committed in the world, whether it is murder, organised crime, money laundering, or trading opium and hashish and those things, is all committed through money that does not go through the banking system," he said, cited by The New Region.

Kocher said the redenomination would not affect daily life or purchasing power, with prices held fixed while the zeros were removed and smaller units introduced, and the public able to exchange old notes for new ones. He said guarantees could be put in place for users of digital transactions to keep the currency under government control while improving transparency.

Iraq had previously relied on France and Germany to print its dinars but has now approached the United Kingdom and Australia to speed up the process, according to the lawmaker.

The move mirrors redenomination drives elsewhere in the region, with neighbouring Iran phasing out old banknotes in a four-zero overhaul of the rial, and Syria's central bank having begun its own redenomination at the start of 2026.