CURRENCY OF THE STRAITS SETTLEMENTS 1865 – 1921.
by Saran Singh AMN, FRNS
by Saran Singh AMN, FRNS
Prior to 1898 the principal monetary unit in the Straits Settlements was the Mexican Dollar which had gradually replaced the earlier Spanish Dollars. Vide order of the Governor in Council of 10th January 1874, (under Ordinance of 1867), the American Trade Dollar and the Japanese Yen (which had been modelled on the Hong Kong Dollars) were admitted to the Straits Settlements as unlimited legal tender on equal parity with the Mexican Dollar. In 1895 the British Trade Dollars were introduced with legal tender status. The subsidiary coinage for the Straits Settlements consisted of the ¼, ½, 1, 5, 10 and 20 cents introduced between 1871 – 1872 and the 50 cents introduced in 1886. There were no official banknote issues by the Government. The banknotes in circulation were issued by three private banks. By 31st December 1891, the total amount of currency notes in circulation were as follows:
Note: The Oriental Bank Corporation which had been formed on 30th Aug 1851 under Royal Charter had a branch in Singapore. This bank collapsed in early 1884 and the outstanding notes issued by its Singapore branch amounting to over $300,900 had to be cashed by the abovementioned private banks so as to maintain their own reputations.
On 1st May 1899 the Straits Settlements Government issued its first series of banknotes in denominations of $5, $10, $50 and $100 dated 1st September 1898, which circulated at par with the Mexican Dollar and the banknotes issued by the two remaining private banks. The first issue of the $1 note was dated 1st September 1906 followed by the $1000 note dated 17th March 1911.
In 1903 and 1904 the first Dollar silver coins for the Straits Settlements were released. The Mexican Dollar, Hong Kong Dollar and the British Trade Dollar coins were demonetized with effect from 31st August 1904 and replaced by the new Straits dollar.
In January 1906 the Straits Settlements had adopted the gold exchange standard. A gold value of 2 shillings 4 pence was given to the Straits Settlements Dollar by the Government which also authorized the Board of Currency Commissioners to receive gold at the rate of £7 for Straits $60.00.
By November 1906, the first Straits Settlements large silver dollars (.900 fine, 26.95 gms, 37.3 mm) dated 1903 and 1904 became intrinsically worth their face value. A second series of smaller Straits dollars of a lower silver weight (.900 fine, 20.21 gms, 34.3 mm) were struck between 1907 – 1909.
This series also became overvalued by August 1917 and was subsequently replaced by a third issue of a further reduced silver content and weight, (.500 fine, 16.84 gms, 34.1 mm) dated 1919 and 1920.
Early in 1917, there were also difficulties connected with the subsidiary silver coinage (5, 10, 20 and 50 cents). This was due mainly to the high and ever rising price of silver and its increasing scarcity owing to the world demand for the metal. This led to a shortage of small change. To overcome the problem, the Government decided to issue new subsidiary coins of the same denomination but with only .400 fine silver content as against the pre-war .600 fine silver coins. Pending the issue of these new coins and to overcome the acute shortage, the Government vide ‘The Legal Tender Enactment 1913 and Amendment Enactment 1917’, issued Emergency 10 Cents and 25 Cents banknotes in 1917. The first issues printed by the Government Survey Office in Kuala Lumpur were rather crude and poorly printed but were gradually improved and proved popular with the people. The 10 Cents Emergency note bearing various dates was issued from 1st October 1917 to 10th June 1920. The 25 Cents Emergency note was undated but was issued between 1917 – 1918.
On 29th August 1918 ‘The Legal Tender (Supplementary) Enactment 1918’ came into force which provided for the issuance of the 5, 10 and 20 cents coins of a lower silver (.400 fine) content. This was followed on the 29th October 1919 by ‘The Legal Tender (Supplementary) Enactment 1919’ which reduced the fineness of the 50 cents and $1 coins from .900 fine to .500 fine. It proved difficult to produce a 5 Cents coin of sufficient size and reduced weight to be easily portable. To overcome this difficulty, a cupro-nickel 5 cents coin was minted in 1920 but it did not become very popular with the people
The value of the Straits Settlements currency in comparison to the British Pound in 1920 was as follows:
Dollar, silver nominally 2 sh. 4 d.
50 cents, silver ” 1 sh. 2 d.
20 cents, silver ” 0 sh. 5.6 d.
10 cents, silver ” 0 sh. 2.8 d.
5 cents, silver ” 0 sh. 1.4 d.
1 cent, copper ” 0 sh. .28 d.
1/2 cent, copper ” 0 sh. .14 d.
1/4 cent, copper ” 0 sh. .07 d.
In 1921, the Straits Settlements dollar was equal to US $0.57 cents. It is interesting to note that in 1983 the Malaysian Ringgit (Dollar) is equal to approximately US $0.43 cents and when compared to the British Pound, it equals 28 pence (The British 28 new pence would be equivalent to about 5 shillings 7 pence in the old terminology). (Note: In July 2011, the Malaysian Ringgit (Dollar) is approximately equal to US$ 0.34 cents).
By early 1921, practically all silver coinage, with the exception of small change, had been gradually replaced in the Straits Settlements and Federated Malay States with the new Straits Settlements banknotes. The denominations of the banknotes in circulation by this time were the 10 cents, 25 cents, $1, $5, $10, $50, $100 and $1000. A $10,000 banknote was introduced soon after in 1922 but this was meant mainly for interbank transactions.
In 1921, ‘The Legal Tender (Supplementary) Enactment came into force. The Chartered Bank of India, Australia & China as well as the Hongkong & Shanghai Banking Corporation relinquished their banknote issuing rights at the request of the Straits Settlements Government. Most of the old banknotes of these two banks had been withdrawn but a total of Straits Settlements $250,185 was still outstanding by late 1921. This balance was however covered by securities lodged in London with the Crown Agents for the Colonies.
It is interesting to note that by 1921 the banknotes of the Straits Settlements circulated at par in British North Borneo (Sabah) but the banknotes of the British North Borneo Company were accepted at a slight discount in the Straits Settlements.
10 Cents, various dates (1917 – 1920) Emergency issue. Size: 118mm x 76mm.
Printer: Government Survey Office, Kuala Lumpur, F.M.S.
Signature: A.M. Pountney (Treasurer), H. Marriot (Acting Treasurer)
10 Cents 14thy October 1919 Emergency issue. Size: 109mm x 63mm
Printer: Thomas De La Rue & Co. Ltd, London
Signature: A.M. Pountney (Treasurer). Dragon on reverse.
25 Cents, No Date (1917 – 1918) Emergency issue. Size: 109mm x 76mm
Printer: Government Survey Office, Kuala Lumpur, F.M.S.
Signature: H. Marriot (Acting Treasurer), Tiger on reverse.
References:
(a) ‘A History of Currency in the British Colonies’ by Robert Chalmers, pages 381 – 388 (England, 1893)
(b) ‘Colonial and Foreign Coinage of Britain’ published by the National Bank of South Africa Ltd. in Pretoria, Transvaal, page 275 (South Africa, 1920)
(c) ‘Guttag’s Foreign Currency and Exchange Guide’ page 56 (New York, 1921)
(d) ‘Dictionary of the World’s Currencies and Foreign Exchanges’ by William F. Spalding, pages 181 – 183 (England, 1928)
(e) Illustrations of above three notes – courtesy of Mr Steven Tan, Kuala Lumpur.
(This article was originally published in the Malaysia Numismatic Society Bulletin,
Volume 15 No. 10, October 1983).
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