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A Brief Introduction to the Many Types of U.S. Banknotes

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While China has the honor of being the birthplace of paper notes hundreds of years before the United States, the first issued by a government in the Western Hemisphere took place right in Colonial America. In the modern era it’s most likely the only banknotes you’ve had to use in commerce have been Federal Reserve Notes. But that was not the case in years prior, as the full gamut of United States banknotes that circulated was once quite vast.

Colonial and Continental Currency

Face and Back of a Province of Maryland, March 1, 1770, $1 (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click images to enlarge.

Massachusetts would be the first of the American colonies to issue paper notes way back in 1690, and all 13 colonies would have their own various issues of paper money through the years leading up to the American Revolution. The Continental Congress went on to issue them from 1775 through 1779. Issues from this era vary greatly, with many different denominations, sizes, designs, anti-counterfeiting measures, and signers, several of the latter having signed our founding documents such as the Declaration of Independence and the United States Constitution.

Obsolete Bank Notes

Uniface 1854 $5 The Bank of the Republic, Providence Rhode Island Obsolete Bank Note (Image Public Domain) Click image to enlarge.

Technically only those notes issued by banks should be considered Obsolete Bank Notes, but in reality most in the hobby lump issues ranging from cities to railroads to individual merchant scrip as an “obsolete,” and there are a great variety of reference books on this vast subject. This subdivision of U.S. banknotes spans from 1782 to 1866 officially, but there are a number of things outside this range that fit in this category as well.

The War of 1812 Treasury Notes

Uniface United States Treasury Department, $10, March 25, 1815, (Image Public Domain) Click image to enlarge.

While most people might say the Demand Notes first issued at the onset of the Civil War in 1861 constitutes the first federal U.S. circulating banknotes, that isn’t quite the case. The first several issues of Treasury Notes during the war would be interest bearing and of fairly high denominations; however, the fifth issue in 1815 consisted of smaller denominations intended to serve as a circulating currency. The war ended mere days after the act was authorized and the population would return to using Obsolete Bank Notes until the federal government intervened again many years later. All of the above make this subcategory of U.S. banknotes so rare that many might not have even heard of it.

Demand Notes

Face and Back of 1861 $5 Demand Note at New York (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

Briefly mentioned in the previous section, Demand Notes came about in 1861. This is where the term “Greenback” originated from the intricate designs on the back filling almost the entire canvas of the note in green artwork. This short-lived series had an additional authorization act in early 1862, but all notes bear an 1861 date. These notes set the size of all future issues of circulating banknotes issued by the federal government (and Federal Reserve System) right up to the resizing of notes in 1928, when the physical dimensions of United States notes shrank to the current size.

Confederate States Currency

Uniface Confederate States of America, 1861 $1,000 (Image Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

The start of the U.S. Civil War necessitated a circulating currency for both the Union and the Confederate South. The Confederacy started issuing its own notes in March of 1861. Several acts of the Confederate Congress brought about numerous issues of banknotes ranging in denominations of 50¢ through $1,000. Many prominent members of the Confederacy are featured on the notes, as well as several buildings and various scenes. These notes were issued right up to the end of the war.

Interest Bearing Notes

Face and Back of 1865 $100 Interest Bearing Note (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

Another product of the money shortage of the Civil War, Interest Bearing Notes were issued as 60-day notes, 1-year notes, 2-year notes, and 3-year notes. These all earned interest for the duration of the stated term at varying amounts from five to seven and three-tenths percent depending on the issue; at the end of that given period the full amount would be payable to the bearer on demand. The 3-year notes had five coupons attached, like a bond, that could be removed and redeemed individually as they matured every six months, and then the final six months could be redeemed when the note itself was presented for redemption. From 1861 to 1865 these notes were issued in denominations from $5 up to $5,000. Because of their interest-bearing nature, and people at that time wanting to collect that interest, very few of these pieces survived. They are categorically rare, and intact high denominations are virtually unheard of in the collecting community.

United States Notes / “Legal Tenders”

Face and Back of Series 1874 $50 United States Note (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

Referred to as Legal Tenders in the hobby, these notes will usually be titled “United States Note,” but they were termed “Treasury Note” for the Series of 1869. This category of U.S. banknotes spanned from 1862 all the way until Series 1966A ($100 only), issued as late as 1970.

National Bank Notes

Face and Back of 1874 $100 National Gold Bank Note from The First National Gold Bank of Petaluma California (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

Brought to fruition by the National Banking Act of 1863, this category of U.S. banknote went on to span over 14,000 individual banks throughout the country (and territories) with many different series and denominations from $1 to $1,000. These banks issued (but didn’t print) notes all the way up until 1935, when the program ended. This vast category of notes includes a subcategory of National Gold Bank Notes that were printed on a gold-tinted paper, depicted a grouping of gold U.S. coins on the back and included text mentioning they were payable in gold coin.

Gold Certificates

Face and Back of Series 1905 “Technicolor” $20 Gold Certificate (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

Initiated with an act in 1863, Gold Certificates feature bright orange backs through the entirety of their Large Size issues, which ended with the Series of 1922 (issued until the resizing downward in 1928). While 1863 saw a $20 denomination, these 1863-dated issues, the rest of which were denominations of $100 through $10,000, were predominantly meant for interbank use and not general circulation. The Series of 1882 would see issues that were meant for the general public to use, and Gold Certificates continued to be issued for the general public through 1932. There was an additional Series of 1934 printed and used only for transactions within the Treasury and Federal Reserve; these notes would be issued through 1945.

Fractional Currency

Face and Back of Fourth Issue (1869-1875) 50¢ Fractional Currency (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

After coins had disappeared from circulation and small-change transactions had reverted to barter, another act of Congress in 1863 brought “paper change” to bear. Fractional Currency was issued all the way through 1876 across five different issues. Denominations range from 3¢ through 50¢. While George Washington is depicted on a great number of these, several other prominent Americans are featured as well.

Compound Interest Treasury Notes

Face and Back of August 15, 1864 $20 Compound Interest Treasury Note (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

These interesting notes were issued late during the Civil War when physical money was rare and the country was nearly bankrupt. Acts of Congress in 1863 and 1864 authorized the issue of these notes that bore 6% interest for 3 years, compounded twice a year. These notes were issued in denominations of $10, $20, $50, $100, $500, and $1,000; they were all issued with overprinted dates of 1864-1865. All notes bear the same sort of bronzing overprint seen on Fractional Currency of the same era.

Silver Certificates

Face and Back of Series 1896 “History Instructing Youth” $1 Silver Certificate (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

Silver Certificates came about in 1878 with another Act of Congress. These were issued in denominations up to $1,000, but in the Small Size format after 1928 they continued only with $1, $5, and $10. Silver Certificates continued to be issued up through Series 1957B, which were issued as late as 1965, coinciding with the end of 90% silver coinage for general circulation. This category of notes is home to arguably the most artistic federal banknotes ever printed: the Educational Series of 1896.

Refunding Certificates

Face and Back of 1879 $10 Payable to Bearer Refunding Certificate (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

With an 1879 Act of Congress, the Treasury made it more enticing for the common person to invest in government securities. These notes would be issued only in the $10 denomination and in two different types; the first was payable to order, and the name of the purchaser would be written on the face of the note in the space provided. The second type was payable to bearer and required no signature. Both types earned interest at 4% indefinitely. However, in 1907 another Act of Congress stopped them from earning further interest. By this time, the redemption value was more than double face value, which they remain today – but the collector value is much higher. Both types feature a portrait of Benjamin Franklin and intricate lathwork.

Treasury or Coin Notes

Face and Back of Series 1890 $1,000 “Grand Watermelon” Treasury Note (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

A legal tender act in 1890 created this short-lived series of notes. These notes were redeemable in gold or silver coin at the Treasury at their discretion. A number of members of the Union Army and Navy are featured on these notes, as well as two prominent Americans not featured on other currency. Although there were only two series printed (1890 and 1891), some of the smaller denominations were issued as late as 1898.

Federal Reserve Notes

Face and Back of Series 1928 $500 Chicago Federal Reserve Note Serial # 1 (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

The Federal Reserve System was founded in 1913, and the first “FRNs,” as they are commonly called, were issued shortly thereafter starting with Series 1914. All circulating banknotes issued in the modern era consists of Federal Reserve Notes. Over the years, denominations ranged from $1 all the way up to $10,000, although the high denominations have long since been phased out. The Large Size notes (pre 1928) feature scenes of commerce and transport as well as a couple of artworks previously seen on earlier bank notes. The portraits currently on $5, $10, $20, $50, and $100 FRNs are depicting the same people they have since Series 1928, and the backs are a similar story.

Federal Reserve Bank Notes

Face and Back of Series 1918 “Battleship” $2 Boston Federal Reserve Bank Note (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

These notes came about during two eras, and the text used on them will forever confuse them with National Bank Notes to the novice. Two series (1915 and 1918) were used on the Large Size issues, however all Small Size issues were overprinted on Series 1929 National Bank Note stock. All of these issues have the words “National Currency” at the top. The Large Size notes would be payable at the individual Federal Reserve banks, whereas the Small Size notes were meant to function as normal circulating currency. The Small Sized notes were all printed in haste during a bank holiday in 1933 as an emergency to supply banks with fresh cash to prevent bank runs during the depression, which worked so well that these particular notes were seen in circulation as late as the 1960s.

WWII Emergency Issues

Face and Back of Series 1934A $20 “Hawaii” Federal Reserve Note (Images Courtesy of the National Numismatic Collection at the National Museum of American History) Click image to enlarge.

There were two different special issues that came about during WWII to distinguish notes used in hostile territory from normal notes in case they were captured by the enemy; at which point they could be deemed worthless. After the attack on Pearl Harbor, a special issue of $1, $5, $10, and $20 notes were overprinted with brown Treasury seals and serial numbers, as well as black “HAWAII” bold printed on each side of the face and “HAWAII” again on the back in large print covering nearly the entire length of the note. The second issue is somewhat less obvious, for use with armed forces in Europe and North Africa, $1, $5, and $10 Silver Certificates that would normally have a blue Treasury seal were overprinted with a yellow ink instead. The enemy didn’t capture these issues and thus they circulated as normal well after WWII.

This list is by no means exhaustive, as it does not touch on College Currency, Depression Scrip, Advertising Notes, Satirical Notes, Military Payment Certificates, Proofs, Errors, et al.

Sources
  • Bowers, Q. David, Whitman Encyclopedia of U.S. Paper Money. Whitman Publishing, LLC, 2009.
  • Friedberg, Arthur L. and Ira S. Paper Money of the United States: The Standard Reference Work on Paper Money from Colonial Times to the Present. The Coin & Currency Institute, Inc., 2010.
  • Haxby, James A., Standard Catalog of United States Obsolete Bank Notes 1782-1866. Krause Publications, Inc., 1988.
  • Newman, Eric P. The Early Paper Money of America. Krause Publications, 2008.

Currency