When the British first colonised Australia, they though there would be no need for a currency, as convicts didn’t earn a salary and soldiers were paid in promissory or paymaster notes.
But twenty years into the settlement, the need for an official money system became clear.
In 1813, with some settlers taking to making their own money or importing foreign notes and coins, governor Lachlan Macquarie decided to ship in 40,000 Spanish dollars to begin the first official currency system in New South Wales.
The “holey dollar” which became the first distinct currency [Image: Creative Commons]
A hole was punched in the middle of each coin to double the number of coins available for circulation. The punched hole was worth one shilling and three pence (or fifteen pence), while the “holey dollar” was the equivalent of five shillings.
Each coin was stamped with its denomination, the colony’s name and the year.
The “dump” coin taken “holey dollar” which became the first distinct currency [Image: Creative Commons]
When the holey dollar currency was replaced with Britain’s Sterling currency in 1829, the “holey dollar” coins were sent back to England to be melted down.
Last year, one of the six remaining coins sold for the record-breaking price of $550,000. In 2014, another “holey dollar” was stolen from the New South Wales State Library.
The first banknotes sanctioned by the government were released by the Bank of New South Wales in 1816. Once other colonies created their own banks, they too began issuing notes.
After federation in 1901, the government passed the Australian Notes Act in 1910 and issued the first national banknote in 1913.
The note featured the Commonwealth Coat Of Arms and the Goulburn Weir in Victoria.