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A History of Canadian Money

July 9, 2023

By Guy Scott

Native Canadians, with one exception, did not use money or currency. All transactions were made by barter: trading of goods and services. The exception was the Ojibwas, who used small copper pieces as currency. Hard currency or money was a European introduction. The French used coins, but local currency was always in short supply and the average French habitant rarely saw coins. Any French coins were limited to international transactions. At one time, playing cards were used as legal tender.

The British introduced banks and currency on a larger scale. After the British Conquest (1759), currency types from the United States began to influence Canadian monetary systems. Spanish-style gold and silver coins were common, and the (American) decimal system began to creep in. During the War of 1812, the government authorities paid their bills with tokens or bills, literally the first cheques. These cheques were redeemed in full after the war, establishing the reliability of paper money.

The first bank in Ontario, the Bank of Upper Canada, issued its own money in paper form, but backed by gold and silver reserves. The next decades were spent arguing over the whether Canada should use the British (pound) sterling system, or the American dollar decimal system. By the late 1850s, the decimal system was triumphant and the Canada dollar established in the new Dominion of Canada.

The first Canadian coins were imported, and dollar bills were not introduced until 1871. Individual banks were still able to print their own paper money. The Bank of Canada was formed in 1934 to standardize paper notes, but it was in 1944 that all bank-issued money was discontinued in favour of our current paper money. The new bills were colourized (the infamous American joke about ‘monopoly money’ followed!) and labelled in French and English. The monarch of the day was featured in portrait and denominations included $4 and $25 dollar bills, as well as the current ones. Also in 1937, a new issue of Canadian coins were minted featuring the current symbols of Canada:

Penny – Maple Leaf

Nickel – Beaver

Dime – Bluenose Schooner

Quarter – Caribou

50 Cent Piece – Canada’s Coat of Arms

These symbols endure today, except in special occasions when substitutes were used for a limited time. A complete set of new symbols was issued for the Centennial Year (1867-1967) including:

Penny – Rock Dove

Nickel – Rabbit

Dime – Mackerel

Quarter – Bobcat

50 Cent Piece – Howling Wolf

Silver Dollar – Goose

Special Dollar bills were also printed for the Centennial. Since then, the following special coins have been issued:

1973: Commemoration centennial of the RCMP, a mounted Mountie on quarters

1976: Honouring the Montreal Olympics, 28 coins featuring Olympic sports.

1981: $100 gold coins

1983: $1 coin honouring explorer Jacques Cartier

1988: A series in honour of the Calgary Winter Olympics

In 1987, the first mass circulation dollar coin, affectionately nicknamed the loonie was first issued. Within two years, the paper dollars were discontinued. So successful was the loonie, in 1996 the toonie replaced the 2 dollar bill. Despite much resistance (and a lot of good Canadian homour) the coins are now an accepted part of Canadian currency. The loonie effectively doomed the silver dollar. The 50 cent piece has also largely disappeared from circulation. In 2011 the Canadian Government introduced polymer money, and following year, the Royal Canadian Mint minted its final penny.  And so the history of currency marches on…

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