Why did the Chinese use paper money?

Why did the Chinese use paper money?

The first paper banknotes appeared in China about 806 AD. An early use of paper was for letters of credit transferred over large distances, a practice which the government quickly took over from private concerns. The Chinese, with their great gift for pragmatism, labelled this practice “flying money”.

Which country first used paper money?

Chinese
The Chinese were the first to devise a system of paper money, in approximately 770 B.C.

What country does not use paper money?

Sweden: World’s first cashless society by 2023 It took Sweden 362 years to transition from being the first nation in Europe to adopt banknotes in 1661, to becoming the world’s first cashless economy in 2023.

When did the Chinese stop using paper money?

1455
As a result, China eliminated paper money entirely in 1455 and wouldn’t adopt it again for several hundred years. Another not-so-well-known fact: the word cash was originally used to describe the type of round bronze coins with square holes commonly used in the Tang Dynasty, called kai-yuans.

When did the Chinese start using paper money?

Paper bills were first used by the Chinese, who started carrying folding money during the Tang Dynasty (A.D. 618-907) — mostly in the form of privately issued bills of credit or exchange notes — and used it for more than 500 years before the practice began to catch on in Europe in the 17th century.

Why is Chinese paper money called Flying cash?

The local merchants called the certificates “flying cash” because unlike metal money, these paper documents had a tendency to blow away when it was windy. Each certificate had a certain amount of money stated on it and was redeemable for metal cash on demand in the Chinese capital.

Why was paper money used in the Song dynasty?

By the end of the Song dynasty paper money equivalent to 70 million strings of cash were being printed and became preferred to coins; the rulers imposed tight control over the supply of paper money so it could be trusted by the people. The Yuan dynasty tried to maintain the paper currency but inflation proved ruinous.

Why was paper money so important in Europe?

A Means of Economic Control. The widespread acceptance of banknotes depended on whether people believed they could ultimately exchange the currency for something truly valuable, such as gold or silver. In both Europe and the early United States, that trust often was lacking. Besides the government, banks, merchants,…