#first banknote

1661 - First banknotes in Europe

Hello,

I'm Emon. Today we will know about, The First Banknote, How was it born?

Johan Palmstruch founder of Stockholm's bank and first bank was to issue the bank. In 1660 the central government began to issue new coins with low weights than those of the older ones. Most depositors wanted their old heavier coins returned as they had much higher metal values. To counter his actions, he issued credit notes and a certificate of deposit. The certificates were issued as loans by the banking body. They can buy anything and thus the first banknote in Europe were invented. The notes quickly became popular due to being more convenient than the heavier copper notes.

The First Paper Money

Paper bills were first used by the Chinese, who started carrying folding money during the Tang Dynasty (A.D. 618-907) — mostly in the form of privately issued bills of credit or exchange notes — and used it for more than 500 years before the practice began to catch on in Europe in the 17th century. While it took another century or two for paper money to spread to the rest of the world, China was already going through a fairly advanced financial crisis: the production of paper notes had grown until their value plummeted, prompting inflation to soar. As a result, China eliminated paper money entirely in 1455 and wouldn't adopt it again for several hundred years. Another not-so-well-known fact: the word cash was originally used to describe the type of round bronze coins with square holes commonly used in the Tang Dynasty, called kai-yuans.

History of Banknotes

The first Australian banknotes were only produced a century ago but currency existed in Australia well before then. For instance, Aboriginal trade was based on exchange and bartering, and when New South Wales was first established, colonists initially used other makeshift currencies such as rum.

The discovery of gold in 1851 led to the minting of Australia's own gold coins and spurred the development of banking. Commercial banks issued their own notes backed by gold, though people were often wary of them particularly after many banks failed in 1893. The Queensland Treasury also issued their own legal tender banknotes and prohibited private banks in the state from issuing their own notes.

Years of Change

In 1920, the responsibility for the banknote issue was transferred from the Commonwealth Treasury to a Board of Directors, with four members appointed by the Commonwealth Government. The Governor of the Commonwealth Bank was an ex officio member and Chairman. The Commonwealth Bank and the Notes Board, however, were formally independent of one another. At the same time, the administration of the banknote issue was taken over by a special department of the Commonwealth Bank.