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Making Change in Upper Canada

February 28, 2023

A Dollar, 1821

Before currency was standardized in the second half of the nineteenth century, transactions in Upper Canada got by with a mishmash of Spanish, British, French American and Canadian (issued by various banks, rather than the government itself) currencies. Barter was the most common type of exchange. To make matters worse, around the time that many communities were founded in the upper Kawarthas, the colony was in the midst of a financial crisis. The system was really built upon trust, because if anyone actually called someone’s debt, few people would be able to pay in currency, though they may have net worth a balance sheet. One prominent gentleman from the district was ruined because his debts were called, and though the theoretical value of his land holdings exceeded his debts, he could not pay in currency.

Stores and taverns were typically among the first businesses in emerging Upper Canadian settlements, in many communities they were founded together. Fenelon Falls’ Robert Jameson (whose grandfather John founded the world-renowned Dublin brewery) operated both businesses by the falls, as portrayed in Anne Langton’s early sketch of the village. Practically everyone would patronize the general store, but in its early days, not everyone would have money to pay for their purchases. Typically merchants would just keep written records of the accounts, and eventually receive goods or services in exchange for the items that their customers needed.

To the extent that there was currency in the first half of the nineteenth century, it was a mix of many different currencies, and merchants would have to be able to convert between them. To make matters more confusing, there was more than one standard for conversion.

The dollar was Spanish—the Spanish-American colonies had an abundance of silver, so their coins ended up being used internationally, and the British standardized exchange rates (1 dollar = 5 shillings)—it was effectively legal tender—but not everyone used the official exchange rate, local customs might prevail. 

British currency was not decimal, twelve pence made a shilling, and twenty shillings equalled a pound—so 240 pence made up a pound. A guinea (coin) was 21 shillings. American currency was also common, as were coins from Lower Canada.

Upper Canada issued coins, predominantly pennies and half pennies. In the absence of ‘real’ money, blacksmiths produced crude forgeries, commonly called blacksmith tokens—typically imitations of pennies or half-pennies that could readily be distinguished from the genuine article. Around mid century, paper money started to become more common.

If a customer was in the position to actually pay with money, it might well be a mix of different currencies, and a merchant would have to know the exchange rates. Copper coins were by far the most common often weighed rather than counted—not everyone would separate Lower Canadian sous, blacksmith tokens, British farthings (4 farthings = 1 pence), and pennies.

Just imagine what it was like trying to make a major purchase…

Prospective farmers would be left figuring out the answer to math problems like: If your farm lot costs £50 and you have 5 guineas, 7 Spanish dollars, 22 shillings and 18 pounds of coppers (many of them produced by a blacksmith), do you have enough money?

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