Legal tender

Legal tender

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Legal tender is a medium of payment
Payment
A payment is the transfer of wealth from one party to another. A payment is usually made in exchange for the provision of goods, services or both, or to fulfill a legal obligation....

 allowed by law or recognized by a legal system to be valid for meeting a financial obligation. Paper currency
Currency
In economics, currency refers to a generally accepted medium of exchange. These are usually the coins and banknotes of a particular government, which comprise the physical aspects of a nation's money supply...

 is a common form of legal tender in many countries.

The origin of the word is from Middle English tendren, French tendre (verb form), meaning to offer. The Latin root is tendere (to stretch out), and the sense of tender as an offer is related to the etymology of the English word extend (to hold outward). The noun form of a tender as an offering is a back-formation of the noun from the verb.

Legal tender is variously defined in different jurisdiction
Jurisdiction
Jurisdiction is the practical authority granted to a formally constituted legal body or to a political leader to deal with and make pronouncements on legal matters and, by implication, to administer justice within a defined area of responsibility...

s. Formally, it is anything which when offered in payment extinguishes the debt. Thus, personal cheque
Cheque
A cheque is a document/instrument See the negotiable cow—itself a fictional story—for discussions of cheques written on unusual surfaces. that orders a payment of money from a bank account...

s, credit card
Credit card
A credit card is a small plastic card issued to users as a system of payment. It allows its holder to buy goods and services based on the holder's promise to pay for these goods and services...

s, debit card
Debit card
A debit card is a plastic card that provides the cardholder electronic access to his or her bank account/s at a financial institution...

s and similar non-cash methods of payment are not usually legal tender. The law does not relieve the obligation until payment is accepted. Coin
Coin
A coin is a piece of hard material that is standardized in weight, is produced in large quantities in order to facilitate trade, and primarily can be used as a legal tender token for commerce in the designated country, region, or territory....

s and note
Banknote
A banknote is a kind of negotiable instrument, a promissory note made by a bank payable to the bearer on demand, used as money, and in many jurisdictions is legal tender. In addition to coins, banknotes make up the cash or bearer forms of all modern fiat money...

s are usually defined as legal tender. Some jurisdictions may forbid or restrict payment made other than by legal tender. For example, such a law might outlaw the use of foreign coins and bank notes, or require a license
License
The verb license or grant licence means to give permission. The noun license or licence refers to that permission as well as to the document recording that permission.A license may be granted by a party to another party as an element of an agreement...

 to perform financial transaction
Financial transaction
A financial transaction is an event or condition under the contract between a buyer and a seller to exchange an asset for payment. It involves a change in the status of the finances of two or more businesses or individuals.-History:...

s in a foreign currency.

In some jurisdictions legal tender can be refused as payment if no debt exists prior to the time of payment (where the obligation to pay may arise at the same time as the offer of payment). For example vending machine
Vending machine
A vending machine is a machine which dispenses items such as snacks, beverages, alcohol, cigarettes, lottery tickets, consumer products and even gold and gems to customers automatically, after the customer inserts currency or credit into the machine....

s and transport staff do not have to accept the largest denomination of banknote. Shopkeepers can reject large banknotes — this is covered by the legal concept known as invitation to treat
Invitation to treat
Invitation to treat is a contract law term. It comes from the Latin phrase invitatio ad offerendum and means "inviting an offer". Or as Andrew Burrows writes, an invitation to treat is...

. However, restaurant
Restaurant
A restaurant is an establishment which prepares and serves food and drink to customers in return for money. Meals are generally served and eaten on premises, but many restaurants also offer take-out and food delivery services...

s that do not collect payment until after a meal is served would have to accept that legal tender for the debt incurred in purchasing the meal.

The right, in many jurisdictions, of a trader to refuse to do business with any person means a purchaser cannot demand to make a purchase, and so declaring a legal tender in law, as anything other than an offered payment for debts already incurred, would not be effective.

Demonetisation



Coins and banknotes may cease to be legal tender if new notes of the same currency
Currency
In economics, currency refers to a generally accepted medium of exchange. These are usually the coins and banknotes of a particular government, which comprise the physical aspects of a nation's money supply...

 substitute them or if a new currency is introduced replacing the former one. Examples of this are:
  • The United Kingdom, adopting decimal
    Decimalisation
    Decimal currency is the term used to describe any currency that is based on one basic unit of currency and a sub-unit which is a power of 10, most commonly 100....

     currency in place of pounds, shillings, and pence in 1971. Banknotes remained unchanged (except for the replacement of the 10 shilling note by the 50 pence coin). In 1968 and 1969 decimal coins which had precise equivalent values in the old currency (5p, 10p, 50p) were introduced, while decimal coins with no precise equivalent (½p, 1p, 2p) were introduced on 15 February 1971. The smallest and largest non-decimal circulating coins, the half penny and half crown, were withdrawn in 1969, and the other non-decimal coins with no precise equivalent in the new currency (1d, 3d) were withdrawn later in 1971. Non-decimal coins with precise decimal equivalents (6d ( = 2½p), 1 and 2 shillings) remained legal tender either until the coins no longer circulated (1980 in the case of the 6d), or the equivalent decimal coins were reduced in size in the early 1990s. The 6d coin was permitted to remain in large circulation throughout the United Kingdom due to the London Underground committee's large investment in coin-operated ticketing machines that used it. Old coins returned to the Royal Mint through the UK banking system will be redeemed for legal tender without time limits, but coins issued before 1947 have a higher value for their silver content than for their monetary value.
  • The successor states of the Soviet Union
    Soviet Union
    The Soviet Union , officially the Union of Soviet Socialist Republics , was a constitutionally socialist state that existed in Eurasia between 1922 and 1991....

     replacing the Soviet ruble
    Soviet ruble
    The Soviet ruble or rouble was the currency of the Soviet Union. One ruble is divided into 100 kopeks, ....

     in the 1990s.
  • Currencies used in the Eurozone
    Eurozone
    The eurozone , officially called the euro area, is an economic and monetary union of seventeen European Union member states that have adopted the euro as their common currency and sole legal tender...

     before being replaced by the euro
    Euro
    The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...

     are not legal tender, but all banknotes are redeemable for euros for a minimum of 10 years (for certain notes there is no time limit).


Individual coins or banknotes can be demonetised and cease to be legal tender (for example, the pre-decimal United Kingdom farthing or the Bank of England 1 pound note), but the Bank of England does redeem all Bank of England banknotes for legal tender at its counters in London (or by post) regardless of how old they are. Banknotes issued by retail banks in the UK are not legal tender, but one of the criteria for legal protection under the Forgery and Counterfeiting Act is that banknotes must be payable on demand, therefore withdrawn notes remain a liability of the issuing bank without any time limits.

In the case of the euro, coins and banknotes of former national currencies were considered as legal tender from 1 January 1999 until 28 February 2002 (in some cases). Legally, those coins and banknotes were considered non-decimal sub-divisions of the euro.

When the Iraqi Swiss dinar ceased to be legal tender in Iraq, it still circulated in the northern Kurdish regions, and despite lacking government backing, it had a stable market value for more than a decade. This example is often cited to demonstrate that the value of a currency is not derived purely from its legal status.

This is also true of the paper money issued by the Confederate States of America
Confederate States of America
The Confederate States of America was a government set up from 1861 to 1865 by 11 Southern slave states of the United States of America that had declared their secession from the U.S...

 during the American Civil War
American Civil War
The American Civil War was a civil war fought in the United States of America. In response to the election of Abraham Lincoln as President of the United States, 11 southern slave states declared their secession from the United States and formed the Confederate States of America ; the other 25...

. Although Confederate currency became worthless by its own terms after the war, since it could only be redeemed a stated number of years after a peace treaty was signed between the Confederacy and the United States (which never happened as the Confederacy was defeated and dissolved), the value of Confederate currency today as a historical and collectible item is usually much greater than its face value.

Demonetisation is currently prohibited in the United States; the Coinage Act of 1965 (quoted in the previous section) applies to all U.S. coins and currency regardless of age. The closest historical equivalent in the U.S., other than Confederate money, was from 1933 to 1974, when the government banned most private ownership of gold bullion, including gold coins held for non-numismatic
Numismatics
Numismatics is the study or collection of currency, including coins, tokens, paper money, and related objects. While numismatists are often characterized as students or collectors of coins, the discipline also includes the broader study of money and other payment media used to resolve debts and the...

 purposes; at present, however, even surviving pre-1933 gold coins are legal tender under the 1964 act.

Withdrawal from circulation


Banknotes and coins may be withdrawn from circulation, but remain legal tender. United States banknotes issued at any date remain legal tender even after they are withdrawn from circulation. Canadian 1- and 2-dollar bills remain legal tender even though they have been withdrawn and replaced by coins, while Canadian $1000 bills remain legal tender although they are removed from circulation as they arrive at a bank. However, Bank of England notes that are withdrawn from circulation generally cease to be legal tender although they remain redeemable for current currency at the Bank of England itself or by post. All paper and polymer issues of New Zealand
New Zealand
New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...

 banknotes issued from 1967 onwards (and 1- and 2-dollar notes until 1993) are still legal tender; 1- and 2-cent coins are no longer used in Australia
Australia
Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...

 and New Zealand
New Zealand
New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...

.

Commemorative issues


Sometimes currency issues such as commemorative coins or transfer bills may be issued that are not intended for public circulation but are nonetheless legal tender. An example of such currency is Maundy money
Maundy money
Royal Maundy is a religious service in the Church of England held on Maundy Thursday, the day before Good Friday. At the service, the British Monarch or a royal official ceremonially distributes small silver coins known as "Maundy money" as symbolic alms to elderly recipients...

. Some currency issuers, particularly the Scottish banks, issue special commemorative banknotes which are intended for ordinary circulation. As well, some standard coins are minted on higher-quality dies as 'uncirculated' versions of the coin, for collectors to purchase at a premium; these coins are nevertheless legal tender. Some countries issue precious-metal coins which have a currency value indicated on them which is far below the value of the metal the coin contains — these coins are known as "non-circulating legal tender" or "NCLT".

Australia


In Australia
Australia
Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...

, the creation of legal tender, in the form of notes and base metal
Base metal
In chemistry, the term base metal is used informally to refer to a metal that oxidizes or corrodes relatively easily, and reacts variably with diluted hydrochloric acid to form hydrogen. Examples include iron, nickel, lead and zinc...

coins, is the exclusive right of the Commonwealth Government. According to the Australian Constitution, s 115 which states: "A State shall not coin money, nor make anything but gold and silver coin a legal tender in payment of debts." Under this provision the Perth Mint
Perth Mint
The Perth Mint is Australia's oldest currently operating mint ....

, owned by the Western Australia
Western Australia
Western Australia is a state of Australia, occupying the entire western third of the Australian continent. It is bounded by the Indian Ocean to the north and west, the Great Australian Bight and Indian Ocean to the south, the Northern Territory to the north-east and South Australia to the south-east...

n Government, still produces gold and silver coins with legal tender status, the Australian Gold Nugget
Australian Gold Nugget
The Australian Gold Nugget is a gold bullion coin minted by the Perth Mint. The coins have been minted in denominations of 1/20 oz, 1/10 oz, 1/4 oz, 1/2 oz, 1 oz, 2 oz, 10 oz, and 1 kg of 24 carat gold...

 and Australian Silver Kookaburra
Australian Silver Kookaburra
The Silver Kookaburra is a silver bullion coin originating from Australia, and produced at the Perth Mint. The coins are .999 fine silver. They are minted in the following four sizes:...

. These, however, although having the status of legal tender, are almost never circulated or used in payment of debts, and are mostly considered bullion coins.

Australian notes are legal tender, as established by the Reserve Bank Act 1959 for all amounts. Australian coins for general circulation, now produced at the Royal Australian Mint
Royal Australian Mint
The Royal Australian Mint is situated in the Australian federal capital city of Canberra, in the suburb of Deakin.Before the opening of the mint, Australian coins were struck at branches of the Royal Mint - the Sydney Mint, Melbourne Mint and Perth Mint. The Royal Australian Mint holds a place in...

 in Canberra
Canberra
Canberra is the capital city of Australia. With a population of over 345,000, it is Australia's largest inland city and the eighth-largest city overall. The city is located at the northern end of the Australian Capital Territory , south-west of Sydney, and north-east of Melbourne...

, are also legal tender, under the provisions of the Currency Act 1965, but only for the following amounts:
  • not exceeding 20¢ if 1¢ and/or 2¢ coins are offered;
  • not exceeding $5 if any of 5¢, 10¢, 20¢ and 50¢ coins are offered;
  • not exceeding 10 times the face value if coins in the range 50¢ to $10 inclusive are offered;
  • to any value if face value is greater than $10 are offered.


The one cent and two cent coins have been withdrawn from circulation since February 1992, but they remain legal tender.

According to the Reserve Bank of Australia, the legal framework for legal tender in Australia
Australia
Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...

 is somewhat unclear. The Reserve Bank Act 1959 and Currency Act 1965 establish that it is not legally required to accept legal tender, even for an existing debt, although failure to do so may be prejudicial in future legal proceedings.

In Australia, except for when sending items via Registered Post, Australia Post prohibits the sending of coins or banknotes, for any country, in the post.

History


In 1901 notes in circulation in Australia
Australia
Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...

 consisted of bank notes payable in gold coin and issued by the trading banks, and Queensland Treasury notes. Bank notes circulated in all States except Queensland
Queensland
Queensland is a state of Australia, occupying the north-eastern section of the mainland continent. It is bordered by the Northern Territory, South Australia and New South Wales to the west, south-west and south respectively. To the east, Queensland is bordered by the Coral Sea and Pacific Ocean...

, but were not legal tender except for a brief period in 1893 in New South Wales
New South Wales
New South Wales is a state of :Australia, located in the east of the country. It is bordered by Queensland, Victoria and South Australia to the north, south and west respectively. To the east, the state is bordered by the Tasman Sea, which forms part of the Pacific Ocean. New South Wales...

. There were, however, some restrictions on their issue or other provisions for the protection of the public. Queensland Treasury notes were issued by the Queensland Government and were legal tender in that State. Notes of both categories continued in circulation until 1910, when the Australian Notes Act 1910 and Bank Notes Tax Act 1910 were passed by the Commonwealth Parliament. The Australian Notes Act 1910 prohibited the circulation of State notes as money and the Bank Notes Tax Act 1910 imposed a tax of ten per cent per annum on 'all bank notes issued or re-issued by any bank in the Commonwealth after the commencement of this Act, and not redeemed'. These Acts put an end to the issue of notes by the trading banks and the Queensland Treasury. The Reserve Bank Act 1959 expressly prohibits persons and states from issuing 'a bill or note for the payment of money payable to bearer on demand and intended for circulation'.

Canada


Canadian dollar
Canadian dollar
The Canadian dollar is the currency of Canada. As of 2007, the Canadian dollar is the 7th most traded currency in the world. It is abbreviated with the dollar sign $, or C$ to distinguish it from other dollar-denominated currencies...

 banknotes issued by the Bank of Canada
Bank of Canada
The Bank of Canada is Canada's central bank and "lender of last resort". The Bank was created by an Act of Parliament on July 3, 1934 as a privately owned corporation. In 1938, the Bank became a Crown corporation belonging to the Government of Canada...

 are legal tender in Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...

. However, commercial transactions may legally be settled in any manner agreed by the parties involved with the transactions. For example, convenience stores may refuse $100 bank notes if they feel that would put them at risk of being counterfeit
Counterfeit
To counterfeit means to illegally imitate something. Counterfeit products are often produced with the intent to take advantage of the superior value of the imitated product...

 victims; however, official policy suggests that the retailers should evaluate the impact of that approach. In the case that no mutually acceptable form of payment can be found for the tender, the parties involved should seek legal advice.

As outlined in the Currency Act, there is a limit the value of a transaction for which you can use only coins. A payment in coins is legal tender for no more than the following amounts for the following denominations of coins:
  1. forty dollars if the denomination is two dollars or greater but does not exceed ten dollars;
  2. twenty-five dollars if the denomination is one dollar;
  3. ten dollars if the denomination is ten cents or greater but less than one dollar;
  4. five dollars if the denomination is five cents; and
  5. twenty-five cents if the denomination is one cent.

Eurozone


Euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...

 coins and banknotes became legal tender in most countries of the Eurozone
Eurozone
The eurozone , officially called the euro area, is an economic and monetary union of seventeen European Union member states that have adopted the euro as their common currency and sole legal tender...

 on January 1, 2002. Although one side of the coins is used for different national marks for each country, all coins and all banknotes are legal tender throughout the eurozone
Eurozone
The eurozone , officially called the euro area, is an economic and monetary union of seventeen European Union member states that have adopted the euro as their common currency and sole legal tender...

. Therefore, it is possible to find Irish euro coins
Irish euro coins
Irish euro coins all share the same design by Jarlath Hayes, that of the harp, a traditional symbol for Ireland since the Middle Ages, based on that of the Brian Boru harp, housed in Trinity College, Dublin. The same harp is used as the official seals of the Taoiseach, and government ministers and...

 in Greece
Greece
Greece , officially the Hellenic Republic , and historically Hellas or the Republic of Greece in English, is a country in southeastern Europe....

 and Finnish euro coins
Finnish euro coins
Finnish euro coins feature three separate designs. Heikki Häiväoja provided the design for the 1 cent – 50 cent coins, Pertti Mäkinen provided the design for the 1 euro coin, and Raimo Heino provided the design for the 2 euro coin, which shows cloudberry, the golden berry of northern Finland...

 in Portugal
Portugal
Portugal , officially the Portuguese Republic is a country situated in southwestern Europe on the Iberian Peninsula. Portugal is the westernmost country of Europe, and is bordered by the Atlantic Ocean to the West and South and by Spain to the North and East. The Atlantic archipelagos of the...

, for instance. Although some eurozone countries do not put 1 cent and 2 cent coins into general circulation (prices in those countries are by general understanding always rounded to whole multiples of 5 cent), 1 cent and 2 cent coins from other eurozone countries remain legal tender in those countries.

European Regulation EC 974/98 limits the number of coins that can be offered for payment to fifty. National laws may also impose restrictions as to maximal amounts that can be settled by coins or notes.

France


Historically, legal tender was enacted the first time in 1870 for all notes and coins of the Banque de France
Banque de France
The Banque de France is the central bank of France; it is linked to the European Central Bank . Its main charge is to implement the interest rate policy of the European System of Central Banks...

. Anyone refusing such monies for their whole value would be prosecuted (French Penal Code art. R. 642-3).

Republic of Ireland



According to the Economic and Monetary Union Act, 1998 of the Republic of Ireland
Republic of Ireland
Ireland , described as the Republic of Ireland , is a sovereign state in Europe occupying approximately five-sixths of the island of the same name. Its capital is Dublin. Ireland, which had a population of 4.58 million in 2011, is a constitutional republic governed as a parliamentary democracy,...

 which replaced the legal tender provisions that had been re-enacted in Irish legislation from previous British enactments, No person, other than the Central Bank of Ireland and such persons as may be designated by the Minister by order, shall be obliged to accept more than 50 coins denominated in euro or in cent in any single transaction.

Irish history


The Decimal Currency Act, 1970 governed legal tender prior to the adoption of the euro and laid down the analogous provisions as in United Kingdom legislation (all inherited from previous British law
Law of the United Kingdom
The United Kingdom has three legal systems. English law, which applies in England and Wales, and Northern Ireland law, which applies in Northern Ireland, are based on common-law principles. Scots law, which applies in Scotland, is a pluralistic system based on civil-law principles, with common law...

), namely: coins denominated above 10 pence became legal tender for payment not exceeding 10 pounds, coins denominated not more than 10 pence became legal tender for payment not exceeding 5 pounds, and bronze coins became legal tender for payment not exceeding 20 pence.

India


The Indian rupee
Indian rupee
The Indian rupee is the official currency of the Republic of India. The issuance of the currency is controlled by the Reserve Bank of India....

 is the de facto legal tender currency in India
India
India , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world...

. The Indian rupee is also legal tender in Nepal
Nepal
Nepal , officially the Federal Democratic Republic of Nepal, is a landlocked sovereign state located in South Asia. It is located in the Himalayas and bordered to the north by the People's Republic of China, and to the south, east, and west by the Republic of India...

 and Bhutan
Bhutan
Bhutan , officially the Kingdom of Bhutan, is a landlocked state in South Asia, located at the eastern end of the Himalayas and bordered to the south, east and west by the Republic of India and to the north by the People's Republic of China...

, although the Nepalese rupee
Nepalese rupee
The rupee is the official currency of Nepal. The present rupee has the ISO 4217 code NPR and is normally abbreviated with the sign ₨. It is subdivided into 100 paisa. The issuance of the currency is controlled by the Nepal Rastra Bank...

 and Bhutanese ngultrum
Bhutanese ngultrum
The ngultrum has been the currency of Bhutan since 1974. It is subdivided into 100 chhertum .-History:In 1974, the ngultrum was introduced, replacing the rupee at par...

 are not legal tender in India. The value of both the Nepalese rupee and Bhutanese ngultrum are pegged with the Indian rupee.

In previous times, the Indian rupee was regarded as an official currency of other countries, including the Straits Settlements
Straits Settlements
The Straits Settlements were a group of British territories located in Southeast Asia.Originally established in 1826 as part of the territories controlled by the British East India Company, the Straits Settlements came under direct British control as a crown colony on 1 April 1867...

 (now Singapore
Singapore
Singapore , officially the Republic of Singapore, is a Southeast Asian city-state off the southern tip of the Malay Peninsula, north of the equator. An island country made up of 63 islands, it is separated from Malaysia by the Straits of Johor to its north and from Indonesia's Riau Islands by the...

 and parts of Malaysia), Kuwait
Kuwait
The State of Kuwait is a sovereign Arab state situated in the north-east of the Arabian Peninsula in Western Asia. It is bordered by Saudi Arabia to the south at Khafji, and Iraq to the north at Basra. It lies on the north-western shore of the Persian Gulf. The name Kuwait is derived from the...

, Bahrain
Bahrain
' , officially the Kingdom of Bahrain , is a small island state near the western shores of the Persian Gulf. It is ruled by the Al Khalifa royal family. The population in 2010 stood at 1,214,705, including 235,108 non-nationals. Formerly an emirate, Bahrain was declared a kingdom in 2002.Bahrain is...

, Qatar
Qatar
Qatar , also known as the State of Qatar or locally Dawlat Qaṭar, is a sovereign Arab state, located in the Middle East, occupying the small Qatar Peninsula on the northeasterly coast of the much larger Arabian Peninsula. Its sole land border is with Saudi Arabia to the south, with the rest of its...

, and the Trucial States
Trucial States
The Trucial States were a group of sheikhdoms in the Persian Gulf.-General aspects:The sheikdoms included:*Abu Dhabi *Ajman...

 (now the UAE).

In 1837, the Indian rupee was made the sole official currency of the Straits Settlements, as it was administered as a part of India. In 1845, the British replaced the Indian rupee with the Straits dollar
Straits dollar
The Straits dollar was the currency of the Straits Settlements from 1904 until 1939. At the same time, it was also used in the Federated Malay States, the Unfederated Malay States, Sarawak, Brunei, and British North Borneo.-History:...

 after administration of the Straits Settlements separated from India earlier in that same year.

After partition of India and Pakistan in 1947
Partition of India
The Partition of India was the partition of British India on the basis of religious demographics that led to the creation of the sovereign states of the Dominion of Pakistan and the Union of India on 14 and 15...

, the Pakistani rupee
Pakistani rupee
The rupee is the currency of Pakistan. The issuance of the currency is controlled by the State Bank of Pakistan, the central bank of the country. The most commonly used symbol for the rupee is Rs, used on receipts when purchasing goods and services. In Pakistan, the rupee is referred to as the...

 came into existence, initially using Indian coins and Indian currency notes simply overstamped with the word "Pakistan". New coins and banknotes were issued in 1948.

The Gulf Rupee, also known as the Persian Gulf rupee
Gulf rupee
The Gulf rupee, also known as the Persian Gulf rupee , was a currency used in the countries of the Persian Gulf and the Arabian Peninsula between 1959 and 1966...

 (XPGR), was introduced by the Government of India
Government of India
The Government of India, officially known as the Union Government, and also known as the Central Government, was established by the Constitution of India, and is the governing authority of the union of 28 states and seven union territories, collectively called the Republic of India...

 as a replacement for the Indian rupee for circulation exclusively outside the country with the Reserve Bank of India
Reserve Bank of India
The Reserve Bank of India is the central banking institution of India and controls the monetary policy of the rupee as well as US$300.21 billion of currency reserves. The institution was established on 1 April 1935 during the British Raj in accordance with the provisions of the Reserve Bank of...

 Amendment Act of 1 May 1959. This creation of a separate currency was an attempt to reduce the strain put on India's foreign reserves by gold smuggling.

Two states, Kuwait and Bahrain eventually replaced the Gulf rupee with their own currencies (the Kuwaiti dinar
Kuwaiti dinar
The dinar is the currency of Kuwait. It is sub-divided into 1000 fils. It is the highest-valued currency unit in the world.-History:...

 and the Bahraini dinar
Bahraini dinar
The dinar is the currency of Bahrain. It is divided into 1000 fils . The name dinar derives from the Roman denarius. The dinar was introduced in 1965, replacing the Gulf rupee at a rate of 10 rupees = 1 dinar. The Bahraini dinar is abbreviated .د.ب or BD...

) after gaining independence from Britain in 1961 and 1965, respectively.

On 6 June 1966, India devalued the rupee. To avoid following this devaluation, several of the states using the rupee adopted their own currencies. Qatar and most of the Trucial States adopted the Qatar and Dubai riyal
Qatari riyal
The riyal is the currency of the State of Qatar. It is divided into 100 dirham and is abbreviated as either QR or ر.ق .- History :...

, whilst Abu Dhabi adopted the Bahraini dinar
Bahraini dinar
The dinar is the currency of Bahrain. It is divided into 1000 fils . The name dinar derives from the Roman denarius. The dinar was introduced in 1965, replacing the Gulf rupee at a rate of 10 rupees = 1 dinar. The Bahraini dinar is abbreviated .د.ب or BD...

. Only Oman continued to use the Gulf rupee until 1970, with the government backing the currency at its old peg to the pound. Oman later replaced the Gulf rupee with its own rial
Omani rial
The rial is the currency of Oman. It is divided into 1000 baisa .-History:Before 1940, the Indian rupee and the Maria Theresa Thaler were the main currencies circulating in Muscat and Oman, as the state was then known, with rupees circulating on the coast and Thaler in the interior...

 in 1970.

New Zealand


New Zealand
New Zealand
New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...

 has had a complex history of legal tender. At the creation of the colony after the signing of the Treaty of Waitangi
Treaty of Waitangi
The Treaty of Waitangi is a treaty first signed on 6 February 1840 by representatives of the British Crown and various Māori chiefs from the North Island of New Zealand....

 in 1840 there was no legal tender in New Zealand
New Zealand
New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...

, because although the Treaty authorised the British Crown to govern, the laws of Great Britain had not been formally adopted by the new colony.

The British Laws Act 1858 retrospectively adopted the laws of Great Britain, and through the UK's Coinage Act 1816 British coins were confirmed as legal tender in New Zealand
New Zealand
New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...

. Unusually until 1989 the Reserve Bank did not have the right to issue coins as legal tender. Coins had to be issued by the Minister of Finance
Minister of Finance (New Zealand)
The Minister of Finance is a senior figure within the government of New Zealand. The position is often considered to be the most important Cabinet role after that of the Prime Minister....

.

The history of bank notes was considerably more complex. In 1840 the Union Bank
Union Bank
Union Bank was established in 1991 and had its headquarters in Karachi, Sindh, Pakistan. Prior to the merger with Standard Chartered Bank , it was Pakistan's eighth largest bank and had 65 branches in some 22 cities, about US$2 billion in assets, and about 400,000 customers.In 2006, Standard...

 started issuing bank notes under provisions of British law but these were not automatically legal tender.

In 1844 Ordinances were passed making the Union Bank
Union Bank
Union Bank was established in 1991 and had its headquarters in Karachi, Sindh, Pakistan. Prior to the merger with Standard Chartered Bank , it was Pakistan's eighth largest bank and had 65 branches in some 22 cities, about US$2 billion in assets, and about 400,000 customers.In 2006, Standard...

 banknotes legal tender and authorising the government to issue debentures in small denominations, thus creating two sets of legal tender. These debentures were circulated but were traded at a discount to their face value because of distrust of the colonial government by the settler population. In 1845 the Ordinance was disallowed by the British Colonial office and they were recalled, but not without first causing a panic amongst holders of the debentures.

In 1847 the Colonial Bank of Issue
Colonial Bank of Issue
The Colonial Bank of Issue was a New Zealand state owned bank that operated between 1847 and 1856 in an early unsuccessful attempt to create a government-owned issuer of bank notes in New Zealand...

 became the only issuer of legal tender. In 1856 however the Colonial Bank of Issue
Colonial Bank of Issue
The Colonial Bank of Issue was a New Zealand state owned bank that operated between 1847 and 1856 in an early unsuccessful attempt to create a government-owned issuer of bank notes in New Zealand...

 was disbanded and through the Paper Currency Act 1856 the Union Bank
Union Bank
Union Bank was established in 1991 and had its headquarters in Karachi, Sindh, Pakistan. Prior to the merger with Standard Chartered Bank , it was Pakistan's eighth largest bank and had 65 branches in some 22 cities, about US$2 billion in assets, and about 400,000 customers.In 2006, Standard...

 was confirmed once again as an issuer of legal tender. The Act also authorised the Oriental Bank to issue legal tender but this bank ceased operations in 1861.

Between 1861 and 1874 a number of other banks including the Bank of New Zealand
Bank of New Zealand
Bank of New Zealand is one of New Zealand’s largest banks and has been operating continuously in the country since the first office was opened in Auckland in October 1861 followed shortly after by the first branch in Dunedin in December 1861...

, Bank of New South Wales, National Bank of New Zealand
National Bank of New Zealand
The National Bank of New Zealand often referred to as The National Bank is one of New Zealand's largest banks. Throughout much of its history, the National Bank has provided banking services to mainly rural, personal, and small business customers. Its owner is ANZ National Bank Limited, the New...

 and Colonial Bank of New Zealand were created by Acts of Parliament and authorised to issue bank notes backed by gold, however these notes were not legal tender.

The 1893 Bank Note Issue Act allowed the government to declare a bank's right to issue legal tender. This enabled the government to make such a declaration to assist the Bank of New Zealand
Bank of New Zealand
Bank of New Zealand is one of New Zealand’s largest banks and has been operating continuously in the country since the first office was opened in Auckland in October 1861 followed shortly after by the first branch in Dunedin in December 1861...

 when in 1895 the bank encountered financial difficulties that could have led to its failure.

The 1914 Banking Amendment Act gave legal tender status to bank notes from any issuer and removed the requirement that banks authorised to issue bank notes must redeem them on demand for gold (the gold standard
Gold standard
The gold standard is a monetary system in which the standard economic unit of account is a fixed mass of gold. There are distinct kinds of gold standard...

).

In 1933 the Coinage Act created a specific New Zealand coinage and removed legal tender
status from British coins. In the same year the Reserve Bank of New Zealand
Reserve Bank of New Zealand
The Reserve Bank of New Zealand is the central bank of New Zealand and is constituted under the Reserve Bank of New Zealand Act 1989. The Governor of the Reserve Bank is responsible for New Zealand's currency and operating monetary policy. The Bank's current Governor is Dr. Alan Bollard...

 was established. The bank was given a monopoly on the issue of legal tender. The Reserve Bank also provided a mechanism through which the other issuers of legal tender could phase out their bank notes. These banknotes were convertible into British legal tender on demand at the Reserve Bank and remained so until the 1938 Sterling Exchange Suspension Notice that suspended provisions of a 1936 amendment of the 1933 Reserve Bank of New Zealand Act.

The 1964 Reserve Bank of New Zealand Act restated that only notes issued by the Reserve Bank were legal tender. The Act also ended the right of individuals to redeem their bank notes for coin, effectively ending the distinction between coin and notes in New Zealand. The Act came into force in 1967 establishing as legal tender all New Zealand dollar
New Zealand dollar
The New Zealand dollar is the currency of New Zealand. It also circulates in the Cook Islands , Niue, Tokelau, and the Pitcairn Islands. It is divided into 100 cents....

 five dollars banknotes and greater, all decimal coins, the pre-decimal sixpence, the shilling
Shilling
The shilling is a unit of currency used in some current and former British Commonwealth countries. The word shilling comes from scilling, an accounting term that dates back to Anglo-Saxon times where it was deemed to be the value of a cow in Kent or a sheep elsewhere. The word is thought to derive...

, and the florin. Also passed in 1964 was the Decimal Currency Act which created the basis for a decimal currency which was also introduced in 1967.

As at 2005 banknotes were legal tender for all payments, $1 and $2 coins were legal tender for payments up to $100, and 5c, 10c, 20c, and 50c silver coins were legal tender for payments up to $5. These older style silver coins were legal tender until October 2006, after which only the new 10c, 20c and 50c coins, introduced in August 2006, are legal.

Norway


The Norwegian krone
Norwegian krone
The krone is the currency of Norway and its dependent territories. The plural form is kroner . It is subdivided into 100 øre. The ISO 4217 code is NOK, although the common local abbreviation is kr. The name translates into English as "crown"...

 (NOK
NOK
NOK or Nok may refer to:*Kiel Canal *Norwegian krone, NOK is the ISO 4217 code and is used as an abbreviation for the currency.*NYSE stock ticker for Nokia Corporation, based in Finland...

) is legal tender in Norway
Norway
Norway , officially the Kingdom of Norway, is a Nordic unitary constitutional monarchy whose territory comprises the western portion of the Scandinavian Peninsula, Jan Mayen, and the Arctic archipelago of Svalbard and Bouvet Island. Norway has a total area of and a population of about 4.9 million...

 according to a Central Bank act (Norwegian
Norwegian language
Norwegian is a North Germanic language spoken primarily in Norway, where it is the official language. Together with Swedish and Danish, Norwegian forms a continuum of more or less mutually intelligible local and regional variants .These Scandinavian languages together with the Faroese language...

: Sentralbankloven) of 1985-05-24, However, no-one is obliged to accept more than 25 coins of each denomination (of which currently 0.50, 1, 5, 10 and 20 NOK denominations are in common circulation).

Singapore and Brunei


The Singapore dollar
Singapore dollar
The Singapore dollar or Dollar is the official currency of Singapore. It is normally abbreviated with the dollar sign $, or alternatively S$ to distinguish it from other dollar-denominated currencies...

 is legal tender in Brunei
Brunei
Brunei , officially the State of Brunei Darussalam or the Nation of Brunei, the Abode of Peace , is a sovereign state located on the north coast of the island of Borneo, in Southeast Asia...

 since a Currency Interchangeability Agreement was signed on 1967-06-12. Brunei dollar
Brunei dollar
The ringgit Brunei or the Brunei dollar , has been the currency of the Sultanate of Brunei since 1967...

 banknotes (but not coins) are widely accepted throughout Singapore and represent a "customary tender".

Switzerland and Liechtenstein


The Swiss franc
Swiss franc
The franc is the currency and legal tender of Switzerland and Liechtenstein; it is also legal tender in the Italian exclave Campione d'Italia. Although not formally legal tender in the German exclave Büsingen , it is in wide daily use there...

 is the only legal tender in Switzerland
Switzerland
Switzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....

. Any payment consisting of up to 100 Swiss coins is legal tender; banknotes are legal tender for any amount.

The sixth series of Swiss bank notes from 1976, recalled by the National Bank in 2000, is no longer legal tender, but can be exchanged in banks for current notes up until April 2020.

The Swiss franc is also the legal tender of the Principality of Liechtenstein
Liechtenstein
The Principality of Liechtenstein is a doubly landlocked alpine country in Central Europe, bordered by Switzerland to the west and south and by Austria to the east. Its area is just over , and it has an estimated population of 35,000. Its capital is Vaduz. The biggest town is Schaan...

, which is joined to Switzerland in a customs union
Customs union
A customs union is a type of trade bloc which is composed of a free trade area with a common external tariff. The participant countries set up common external trade policy, but in some cases they use different import quotas...

.

The Swiss franc is also the currency used for administrative and accounting purposes by most of the numerous international organisations that are headquartered in Switzerland.

British history


In the 19th century, gold coins were legal tender to any amount, silver coins were not legal tender for sums over 2 pounds, nor bronze for sums over 1 shilling
Shilling
The shilling is a unit of currency used in some current and former British Commonwealth countries. The word shilling comes from scilling, an accounting term that dates back to Anglo-Saxon times where it was deemed to be the value of a cow in Kent or a sheep elsewhere. The word is thought to derive...

.

This provision was retained in revised form at the introduction of decimal currency
Decimal Day
Decimal Day was the day the United Kingdom and Ireland decimalised their currencies.-Old system:Under the old currency of pounds, shillings and pence, the pound was made up of 240 pence , with 12 pence in a shilling and 20 shillings in a...

, and the Coinage Act 1971
Decimal Day
Decimal Day was the day the United Kingdom and Ireland decimalised their currencies.-Old system:Under the old currency of pounds, shillings and pence, the pound was made up of 240 pence , with 12 pence in a shilling and 20 shillings in a...

laid down that coins denominated above 10 pence became legal tender for payment not exceeding 10 pounds, non-bronze coins denominated not more than 10 pence became legal tender for payment not exceeding 5 pounds, and bronze coins became legal tender for payment not exceeding 20 pence.

England and Wales



Bank of England notes
Bank of England note issues
The Bank of England, which is now the Central Bank of the United Kingdom, has issued banknotes since 1694. Since 1970, its new series of notes have featured portraits of British historical figures. Of the eight banks authorised to issue banknotes in the UK, only the Bank of England can issue...

 are the only banknotes that are legal tender in England
England
England is a country that is part of the United Kingdom. It shares land borders with Scotland to the north and Wales to the west; the Irish Sea is to the north west, the Celtic Sea to the south west, with the North Sea to the east and the English Channel to the south separating it from continental...

 and Wales
Wales
Wales is a country that is part of the United Kingdom and the island of Great Britain, bordered by England to its east and the Atlantic Ocean and Irish Sea to its west. It has a population of three million, and a total area of 20,779 km²...

 and are issued in the amounts of £5, £10, £20 and £50. United Kingdom coinage
British coinage
The standard circulating coinage of the United Kingdom is denominated in pounds sterling , and, since the introduction of the two-pound coin in 1998, ranges in value from one penny to two pounds. Since decimalisation, on 15 February 1971, the pound has been divided into 100 pence...

 is legal tender, but in limited amounts for coins below £1—for example, a creditor is not obliged to accept payment of a substantial debt in one-penny coins.

English banknotes can always be redeemed at the Bank of England even if discontinued and not legal tender. Out-of-date banknotes, and sterling notes issued by banks in Scotland, are often accepted in payment.

Scotland and Northern Ireland


Scottish and Northern Irish bank notes are issued by retail banks rather than a national central bank, and as such are technically promissory notes rather than legal tender. Furthermore, Bank of England notes are legal tender only within England and Wales and therefore also have the legal status of promissory notes in Scotland and Northern Ireland. However, general agreement between banks within the United Kingdom is to treat all notes as legal tender. (See British bank notes.)

UK coins


In the United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...

, only coins valued 1 pound
British One Pound coin
The circulating British one pound coin is minted from a nickel-brass alloy of approximately 70% copper, 24.5% zinc, and 5.5% nickel. The coin weighs 9.50 grams and has a diameter of 22.50 millimetres...

, 2 pounds
British Two Pound coin
The British two pound coin was first issued as a commemorative coin in 1986 to celebrate the Commonwealth Games in Scotland. Six further commemorative issues followed between 1989 and 1996...

, and 5 pounds
British Five Pound coin
The British five pound coin is a redenominated commemorative coin, a continuation of the former crown, being identical with it in size and weight. The crown had continued to be minted occasionally after decimalisation, with a value of twenty-five pence, although, as was the case with most...

 Sterling
Pound sterling
The pound sterling , commonly called the pound, is the official currency of the United Kingdom, its Crown Dependencies and the British Overseas Territories of South Georgia and the South Sandwich Islands, British Antarctic Territory and Tristan da Cunha. It is subdivided into 100 pence...

 are legal tender in unlimited amounts throughout the territory of the United Kingdom. In accordance with the Coinage Act 1971, gold sovereigns are also legal tender for any amount. Although not specifically mentioned on them, the face values of gold coins are 50p, £1, £2 and £5, a mere fraction of their worth as bullion. The United Kingdom legislation that introduced the 1 pound coin
British One Pound coin
The circulating British one pound coin is minted from a nickel-brass alloy of approximately 70% copper, 24.5% zinc, and 5.5% nickel. The coin weighs 9.50 grams and has a diameter of 22.50 millimetres...

 left no United Kingdom-wide legal tender banknote.

Currently, twenty pence pieces and fifty pence pieces are legal tender in amounts up to 10 pounds; five pence pieces and ten pence pieces are legal tender in amounts up to 5 pounds; and pennies and two pence coins
Two pence (British decimal coin)
The British decimal two pence coin – often pronounced "two pee" – was issued by the Royal Mint on 15 February 1971, the day the British currency was decimalised. In practice it had been available from banks in bags of £1 for some weeks previously...

 are legal tender in amounts up to 20 pence.

United States


The U.S. Constitution, Art. I Sec. 10 Cl. 1, states, in part:
Before the Civil War (1861 to 1865), silver coins were legal tender only up to the sum of $5. Before 1853, when US silver coins were reduced in weight 7%, silver coins had exactly the value in silver (from 1830 to 1852). Two silver 50 cent coins had exactly $1 worth of silver. A Gold US Dollar of 1849 had $1 worth of gold. With the flood of gold coming out of the California mines in the early 1850s, the price of silver rose (gold went down). Thus, a 50 cent coins of 1840 to 1852 were worth 53 cents if melted down. The government could increase the value of the gold coins (expensive) or reduce the size of all US silver coins. With the reduction of 1853, a 50 cent coin now had only 48 cents of silver. This is the reason for the $5 limit of silver coins as Legal Tender; paying somebody $100 in the new silver coins would be giving them $96 worth of silver. Most people preferred bank check or gold coins for large purchases.

During the early American Civil War
American Civil War
The American Civil War was a civil war fought in the United States of America. In response to the election of Abraham Lincoln as President of the United States, 11 southern slave states declared their secession from the United States and formed the Confederate States of America ; the other 25...

, the federal government first issued United States Demand Note
Demand Note
A Demand Note is a type of United States paper money that was issued between August 1861 and April 1862 during the American Civil War in denominations of 5, 10, and 20 US$...

s (the first greenback notes) which were not redeemable in gold and silver coins but could be used to pay "all dues" to the Federal Government. Since land purchases and duties on imports were only payable in gold or the new Demand Notes, the Demand Notes were bought by importers and land speculators for about 97 cents on the gold dollar and never lost value. 1862 greenbacks (Legal Tender Notes) at first traded for 97 cents on the dollar but gained/lost value depending on fortunes of the Union army. The value of Legal Tender Greenbacks swung wildly but trading was from 85 to 33 cents on the gold dollar.

This resulted in a situation in which the greenback "Legal Tender" notes of 1862 were fiat
Fiat money
Fiat money is money that has value only because of government regulation or law. The term derives from the Latin fiat, meaning "let it be done", as such money is established by government decree. Where fiat money is used as currency, the term fiat currency is used.Fiat money originated in 11th...

, and so gold and silver were held and paper circulated at a discount. see: Gresham's Law
Gresham's Law
Gresham's law is an economic principle that states: "When a government compulsorily overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation." It is commonly...

. The 1861 Demand Notes were a huge success but robbed the customs house of much needed gold coin (interest on most bonds back then was paid in gold). A money-strapped Congress which had to pay for the war eventually adopted the Legal Tender Act of 1862, issuing United States Notes backed only by treasury securities, and compelled the people to accept the new notes at a discount; prices rose except for those who had gold and/or silver coins.

Litigation resulted from debts incurred before the Civil War (when gold coins were common) and 5 years later, the debtor wanted to pay the debt in full with "Legal Tender" (only worth 55 cents on the gold dollar). Bank deposits were often in "current funds (paper money)" or gold coin. Checks were written to be cashed in "gold coin" or "current funds."

The United States Supreme Court, with Salmon P. Chase
Salmon P. Chase
Salmon Portland Chase was an American politician and jurist who served as U.S. Senator from Ohio and the 23rd Governor of Ohio; as U.S. Treasury Secretary under President Abraham Lincoln; and as the sixth Chief Justice of the United States Supreme Court.Chase was one of the most prominent members...

 (former Secretary of the Treasury) ruled the practice of legal tender unconstitutional in Hepburn v. Griswold
Hepburn v. Griswold
Hepburn v. Griswold, 75 U.S. 603 , was a Supreme Court of the United States case in which the Chief Justice, Salmon P. Chase, speaking for the Court, declared certain parts of the legal tender acts to be unconstitutional...

 in 1869, but later reversed its ruling within a month when confusion in the markets caused everybody not to accept "Legal Tender" notes at all. The Court held that paper money, even that not backed by specie such as the United States Note
United States Note
A United States Note, also known as a Legal Tender Note, is a type of paper money that was issued from 1862 to 1971 in the U.S. Having been current for over 100 years, they were issued for longer than any other form of U.S. paper money. They were known popularly as "greenbacks" in their heyday, a...

s can be legal tender, in the Legal Tender Cases
Legal Tender Cases
The Legal Tender Cases were a series of United States Supreme Court cases in the latter part of the nineteenth century that affirmed the constitutionality of paper money. In the 1870 case of Hepburn v. Griswold, the Court had held that paper money violated the United States Constitution. The...

, ranging from 1871 to 1884.

On the other hand, coins made of gold or silver may not necessarily be legal tender, if they are not fiat money in the jurisdiction where they are preferred as payment. The United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...

 Coinage Act of 1965
Coinage Act of 1965
The Coinage Act of 1965, , eliminated silver from the circulating dimes and quarter dollars of the United States, and diminished the silver content of the half dollar from 90% to 40%...

 states (in part):
There is, however, no Federal statute mandating that a private business, a person or an organization must accept currency or coins as for payment for goods and/or services. Private businesses are free to develop their own policies on whether or not to accept cash unless there is a State law which says otherwise. For example, a bus line may prohibit payment of fares in pennies or dollar bills. In addition, movie theaters, convenience stores and gas stations may refuse to accept large denomination currency (usually notes above $20) as a matter of policy.

See also

  • Currency
    Currency
    In economics, currency refers to a generally accepted medium of exchange. These are usually the coins and banknotes of a particular government, which comprise the physical aspects of a nation's money supply...

  • Gresham's law
    Gresham's Law
    Gresham's law is an economic principle that states: "When a government compulsorily overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation." It is commonly...

  • Postage stamp demonetization
  • Standard of deferred payment
    Standard of deferred payment
    A standard of deferred payment is the accepted way, in a given market, to settle a debt – a unit in which debts are denominated. It is one of the defining functions of money; for example, while the gold standard reigned, gold or any currency convertible to gold at a fixed rate constituted such a...

  • Seigniorage
    Seigniorage
    Seigniorage can have the following two meanings:* Seigniorage derived from specie—metal coins, is a tax, added to the total price of a coin , that a customer of the mint had to pay to the mint, and that was sent to the sovereign of the political area.* Seigniorage derived from notes is more...