Postal currency
Encyclopedia
United States Postal Service
The United States Postal Service is an independent agency of the United States government responsible for providing postal service in the United States...
paper money
Paper Money
Paper Money is the second album by the band Montrose. It was released in 1974 and was the band's last album to feature Sammy Hagar as lead vocalist.-History:...
printed in 5¢, 10¢, 25¢, and 50¢ denominations
Denomination (currency)
Denomination is a proper description of a currency amount, usually for coins or banknotes. Denominations may also be used with other means of payment like gift cards. See also Redenomination.-Subunit and super unit:...
and issued from August 21, 1862 through May 27, 1863. They were valid for redemption of postage stamps and, while not actually valid as legal tender
Legal tender
Legal tender is a medium of payment allowed by law or recognized by a legal system to be valid for meeting a financial obligation. Paper currency is a common form of legal tender in many countries....
, they could be exchanged for United States Notes in $5 lots and were receivable in payment of all dues to the United States, up to $5. Essentially, they were postage stamp
Postage stamp
A postage stamp is a small piece of paper that is purchased and displayed on an item of mail as evidence of payment of postage. Typically, stamps are made from special paper, with a national designation and denomination on the face, and a gum adhesive on the reverse side...
s printed on Treasury
United States Department of the Treasury
The Department of the Treasury is an executive department and the treasury of the United States federal government. It was established by an Act of Congress in 1789 to manage government revenue...
paper
Paper
Paper is a thin material mainly used for writing upon, printing upon, drawing or for packaging. It is produced by pressing together moist fibers, typically cellulose pulp derived from wood, rags or grasses, and drying them into flexible sheets....
.
After the American Civil War
American Civil War
The American Civil War was a civil war fought in the United States of America. In response to the election of Abraham Lincoln as President of the United States, 11 southern slave states declared their secession from the United States and formed the Confederate States of America ; the other 25...
broke out the Union
Union (American Civil War)
During the American Civil War, the Union was a name used to refer to the federal government of the United States, which was supported by the twenty free states and five border slave states. It was opposed by 11 southern slave states that had declared a secession to join together to form the...
stopped redeeming its Demand Note
Demand Note
A Demand Note is a type of United States paper money that was issued between August 1861 and April 1862 during the American Civil War in denominations of 5, 10, and 20 US$...
s in specie
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....
at the end of 1861 and many people started hoarding coins
COinS
ContextObjects in Spans, commonly abbreviated COinS, is a method to embed bibliographic metadata in the HTML code of web pages. This allows bibliographic software to publish machine-readable bibliographic items and client reference management software to retrieve bibliographic metadata. The...
. There was a near universal fear that paper currency
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...
would become worthless, especially to the losing side. Deprived of coins with which to make change, many businesses issued their own notes, tokens, or similar printed matter
Printed matter
Printed matter is a term to describe printed material produced by printers or publishers, such as books, magazines, booklets, brochures and other publicity materials and in some cases, newspapers...
as a way of making change. Some resorted to encasing postage stamps in transparent holders which inspired the government to authorize the Postage Currency later in 1862. The 5¢ and 10¢ notes depicted the same pictures as the postage stamps that were current at the time with Thomas Jefferson
Thomas Jefferson
Thomas Jefferson was the principal author of the United States Declaration of Independence and the Statute of Virginia for Religious Freedom , the third President of the United States and founder of the University of Virginia...
and George Washington
George Washington
George Washington was the dominant military and political leader of the new United States of America from 1775 to 1799. He led the American victory over Great Britain in the American Revolutionary War as commander-in-chief of the Continental Army from 1775 to 1783, and presided over the writing of...
. The 25¢ and 50¢ denominations simply had 5 images of the smaller denomination stamps pictured on one note.
The Postal Currency notes were followed by four additional issues of Fractional currency which remained in use until 1876 when Congress
United States Congress
The United States Congress is the bicameral legislature of the federal government of the United States, consisting of the Senate and the House of Representatives. The Congress meets in the United States Capitol in Washington, D.C....
authorized the minting
Mint (coin)
A mint is an industrial facility which manufactures coins for currency.The history of mints correlates closely with the history of coins. One difference is that the history of the mint is usually closely tied to the political situation of an era...
of fractional silver coins to redeem the outstanding fractional currency. Today, the original Postage Currency of 1862 is often collected alongside postage stamps of that era.