Explaining Currency New Zealand’s bank notes and coins
Oct 26, 2014
ExplainingCurrency
New Zealand’s bank notes and coins
2 Explaining Currency: New Zealand’s bank notes and coins
In t roduc t i on 3What is money?
What is legal tender?
Today ’s bank no t e s 4Plastic fantastic
The life-cycle of a bank note
Security features to look for
Special edition millennium $10 note
Bank no t e s : A c l o s e r l o ok 8Five dollar note
Ten dollar note
Twenty dollar note
Fifty dollar note
Hundred dollar note
New Zea land ’s c o in s 13How are our coins made?
Coin design
Commemorative currency
Five cents
Ten cents
Twenty cents
Fifty cents
One dollar
Two dollar
Cur rency t ime l in e 16
A b r i e f h i s t o r y o f New Zea land ’s cu r r ency 17Early days
The Reserve Bank issues bank notes
Decimal currency
Defacing bank notes
Are damaged notes worth anything?
Reproducing or imitating currency
Contents
Explaining Currency: New Zealand’s bank notes and coins 3
Introduct ionWe all use currency - bank notes and coins - but what is
it really?
This booklet describes what money is, what cash or
currency is, how New Zealand’s bank notes are designed
and made, and the life cycle of a typical bank note. It
also looks at the design and security features of our
bank notes and coins, and the history of currency in
New Zealand.
What i s money?In ancient times, people had to barter things to trade - for
instance, a cow for six pigs. This, however, was clumsy. What
if you wanted six pigs but the pig seller didn’t want your
cow, as he or she wanted some sheep instead, which you
didn’t have?
That’s where money came in. Money is a token or measure
that stores wealth. With it, in our example above, the trade
could take place. Also with money you can earn now and
spend later. Early examples of money were shells and iron
nails, as they could easily be counted. In due course, these
were replaced by coins made of gold, silver, bronze and copper
and much later paper money was developed.
These days you can buy things using coins, bank notes,
cheques, or credit cards, or by making an electronic
transaction (EFT-POS etc); all are modern ways of moving
money around. There’s a lot more money around than just
cash. In the New Zealand economy now if you add up all the
cash and all the other money, such as in bank deposits, it
comes to about $100 billion. The value of the bank notes
and coins in circulation is much less at around $2 billion.
However, despite talk about e-commerce, cash remains very
useful for making relatively small transactions instantly and
conveniently.
What i s l e ga l t ende r?The virtue of cash – that you can buy or sell something
instantly and conveniently – comes from the concept of legal
tender. Technically, legal tender means that if I owe you
money and I present you with cash, then the debt is cleared
then and there. The only exception to this is if we both agree
to a different form of payment beforehand.
So, for example, a shop doesn’t have to accept a cheque,
and it doesn’t even have to accept cash, but the shop has to
clearly indicate to you before you do business with them that
they do not accept these forms of payment.
There is a minor qualification to this, in that the law specifies
limits on using annoying amounts of coins as legal tender for
buying larger items. If I owe you, say, $1000, I can’t present
you with $1000 worth of 5 cent coins and require you to
accept them as legal tender.
Reserve Bank notes and coins are defined in the Reserve Bank
Act as “legal tender”. The Reserve Bank is the only
organisation in New Zealand that can issue bank notes and
coins and determine the denominations and design of the
nation’s currency.
4 Explaining Currency: New Zealand’s bank notes and coins
Today’s bank notesPlas t i c f an t a s t i cAll New Zealand’s bank notes are now printed on a
polypropylene polymer material. Previously they were printed
on paper made from cotton.
There were two main reasons why the Reserve Bank decided
to change to polymer. First was wear and tear - polymer
bank notes are stronger and non-porous. Polymer notes last
at least four times as long as paper notes. They don’t get as
dirty and tatty as paper and they are much harder to tear.
Secondly, polymer bank notes allow for more sophisticated
security features to deter forgeries. These security features
are explained in more detail below. In Australia, the
introduction of polymer bank notes in 1992 resulted in
reported forgeries falling significantly.
Polymer is good for the environment too. Whereas paper
notes were shredded and discarded at the end of their lives,
old polymer bank notes can be recycled economically into
useful products such as polymer wheelbarrows, compost bins
and plumbing fittings.
The l i f e - cyc l e o f a bank no t eDesign
The planning, printing and production of a new bank note
design is complex and takes a large team of people up to
two years before the note is issued.
First of all, the design elements of the note have to be decided.
Rough drawings are prepared of the images to be used
(people, birds, plants, flowers, etc.), watermark, text, and
colours.
Once these preliminary details are worked out, a group of
artists produces an exact image or sketch of both sides of
the note in the correct size and colours with the aid of a
computer-based design system. The designers have to think
not only about the Reserve Bank’s requirements, but also
about security features and printing capabilities. Bank notes
are printed in a range of sizes to enable partially sighted and
blind people to distinguish between notes. The largest in
the series is the $100 note and the smallest is the $5.
Printing
New Zealand’s bank notes are printed by Note Printing
Australia in Melbourne. To create a bank note, printing plates,
polymer substrate and ink are brought together in a huge
printing hall. The polymer substrate, on which the bank notes
are printed, starts out as a large roll of clear plastic film.
Explaining Currency: New Zealand’s bank notes and coins 5
To start with, two layers of ink (usually white) are applied to
each side of the clear film, except for areas which are
deliberately left clear, or areas where the ink is printed on
one side of the note only. This stage of the process is called
opacifying.
The next stage is sheeting. This is where the opacified
substrate is cut into large sheets ready for feeding into the
note printing presses.
“Simultan” printing machines print the background colours
and patterns onto the polymer. As the name suggests, both
sides of the notes are printed at the same time, at up to
8000 sheets per hour. Major design elements are printed
using intaglio printing machines during which ink is applied
to the polymer under great pressure. This gives the notes
their raised printing, which is one of the security features of
polymer notes. Separate print runs are required for each
side of the note.
Serial numbers are then added to the notes using a letterpress
printing process. In the current note series, each serial number
consists of a prefix of two letters followed by eight numbers.
The first two of these numbers indicate the year the note
was manufactured.
During the final print run, the notes are given two coats of a
protective overcoating varnish using an offset printing press.
This overcoat makes the notes more durable, as it protects
the printing, and helps to keep the notes clean.
The completed sheets of notes are examined for faults.
Imperfect sheets are marked with a machine-readable ink
for removal later in the process. Printed sheets are guillotined
into individual notes, which are then placed into containers
in alpha-numerical order and transported to computer-
controlled machines for final counting and banding. The
finished notes are then shrink-wrapped, placed on pallets
and stored in a strongroom.
Finally, the finished bank notes are shipped to the Reserve
Bank of New Zealand for distribution to banks. From there,
the notes are made available to customers from tellers and
through cash machines, and the notes start their life in general
circulation. Bank notes usually find their way back into a
bank and are then sorted in machines that count and check
for counterfeits and damaged notes. The good notes are
bundled back up again and recirculated, while damaged notes
are discarded for granulating and recycling.
6 Explaining Currency: New Zealand’s bank notes and coins
1. Each polymer note has two transparent windows.
One of the transparent windows is oval-shaped and
sloping and has the denomination numerals embossed
in it. The other clear window is in the shape of a
curved fern leaf.
2. There is a fern immediately above the clear fern-
shaped window. When you hold the note to the light,
the fern should match perfectly with another fern on
the other side.
Securi ty features to look for3. You should easily be able to see a shadow image of
the Queen when you hold the note to the light.
4. Each note has an individual serial number printed
horizontally and vertically.
5. Polymer notes have raised printing, which stands up
on the surface and can be felt when you run your
fingers over it.
6. Tiny micro-printed letters “RBNZ” should be visible
with a magnifying glass.
7. Under an ultraviolet light, the polymer note appears
dull. Most commercial papers used in forgeries will
glow under an ultraviolet light. However, polymer
notes contain special inks, which make particular
features glow under an ultraviolet light. For example,
the front of each genuine note has a fluorescent patch
showing the denomination numerals, which can only
be seen under an ultraviolet light.
Remember, all images on your bank notes should
appear sharp and well defined - not fuzzy and washed
out.
1 Transparent window1 Transparent window
4 Individual serial
number
5 Raised printing
2 Fern
matches both
sides
3 Shadow image of
Queen Elizabeth II
6 Micro-printing
Explaining Currency: New Zealand’s bank notes and coins 7
The special edi t ion mil lennium $10 noteIn 1999, the Reserve Bank issued a special $10 bank note to
commemorate the new millennium. This limited edition note
depicts New Zealand’s development into the digital age and
some of the recreational pursuits that make New Zealand
special. The design features on the note represent New
Zealand’s past and its future. The front shows a Maori war
canoe, symbolising New Zealand’s journey. It also shows New
Zealand’s future in the digital age. On the back, some of the
recreational pursuits enjoyed in New Zealand are portrayed.
The $10 millennium bank note has special security features
which are world firsts. The most obvious is the two silver
ferns within the clear window, which reflect rainbow colours
when the note is tilted to the light. As well, when you fold
the note over and look at the map of New Zealand on the
back of the note through the clear window, the letters “Y2K”
become visible on the North and South Islands. The letters
can only be seen with the use of the filter incorporated in the
note’s clear window.
8 Explaining Currency: New Zealand’s bank notes and coins
these tractors proved adaptable to the harsh Antarctic
conditions, requiring only minor modifications.
BackCampbell Island scene
Campbell Island is the southernmost of New Zealand’s
outlying islands – about 600 kilometres southeast of Stewart
Island. Campbell Island has an area of 114 square kilometres.
Yellow-eyed penguin or hoiho (Megadyptes
antipodes)
The distinctive thing about the yellow-eyed penguin is its
yellow iris and yellow band of feathers across the back of its
head. One of the world’s rarest penguins, it can be found on
sea-facing scrub and forested slopes along the southeastern
Fron tSir Edmund Hillary (1919-)
Sir Edmund Hillary is New Zealand’s most accomplished
explorer, gaining world renown in 1953 as the first person to
climb Mt Everest. In 1958 Sir Edmund became the first person
to drive overland to the South Pole.
Mount Cook or Aorangi
Mount Cook, in New Zealand’s South Island, is New Zealand’s
highest mountain. It was the scene of Sir Edmund Hillary’s
earliest climbing successes, and is still regarded by Hillary as
one of his favourite mountains.
Massey Ferguson tractor
It was on tractors such as this that Sir Edmund Hillary drove
to the South Pole. A stalwart of New Zealand farming life,
Five dol lar notecoastline of the South Island. As well as Campbell Island,
the hoiho can be found on Stewart and Auckland Islands.
Subantarctic lily (Bulbinella rossii)
The subantarctic lily produces spectacular yellow flower heads
in early summer and grows to a height of about one metre.
It is unique to the subantarctic.
Daisy (Pleurophyllum speciosum)
A giant member of the daisy family, this plant has colourful
white and violet flowers. On Campbell Island, the plants
grow close to the ground to help avoid wind chill and have
corrugated leaves to trap the limited solar energy available
there.
Bull kelp (Durvillaea antarctica)
Bull kelp can grow up to several metres long and is found on
New Zealand coasts as well as subantarctic islands. It has
very tough skin and the strands are honeycombed inside for
buoyancy.
Explaining Currency: New Zealand’s bank notes and coins 9
Ten dol lar note
Fron tKate Sheppard (1848-1934)
Kate Sheppard was the most prominent leader of the
campaign for universal suffrage in New Zealand. She worked
tirelessly to organise and promote her cause. A long campaign
culminated in 1893 when New Zealand became the first
country in the world to extend voting rights to women.
White camellia
In 1893 white camellias were given to Members of Parliament
who had supported the bill to give New Zealand women the
vote. The flower has become a symbol of the fight for the
vote by New Zealand women. The flowers on the ten dollar
note are Camellia japonica alba plena.
BackBlue duck or whio (Hymenolaimus
malacorhynchos)
The rare blue duck is an endangered species which is found
mainly in mountainous areas of New Zealand. It usually lives
in pairs or family groups and prefers fast-flowing river habitats.
Now totally protected, the whio is making a comeback as
the population is steadily increasing.
Parahebe catarractae
This riverside plant, a close relative of the hebe – the largest
plant group unique to New Zealand – can be found in both
North and South Islands. It grows in crevices in rocks, beside
streams and sometimes in the spray of waterfalls. It can grow
up to 60cm high and is notable for its trailing stems and
attractive purple flowers.
Blechnum fern or mountain kiokio
This is a very common fern throughout New Zealand, which
grows best in damp and shady places. In young plants like
the specimen on the note, the fronds are tinged pink.
Below: The current series notes are the sixth; here isthe fourth series ten dollar note.
10 Explaining Currency: New Zealand’s bank notes and coins
Twenty dol lar note
Fron tHer Majesty Queen Elizabeth II (1926-)
This note features an official portrait of the Queen taken at
Government House, Wellington, on 26 February 1986 by
Ronald Woolf. Her Majesty is wearing the Sovereign’s Badge
of the Order of New Zealand. The ribbon is based on a taniko
pattern.
Parliament Buildings, Wellington
The $20 note shows two of the three buildings of the New
Zealand Parliament, situated in Wellington. The older
building, an imposing structure clad in Takaka marble, houses
the Legislative Chamber. The foundations for this building
were laid in 1912, but the First World War delayed
construction and the building was not completed until 1922.
The distinctive Beehive Executive Wing, designed by Sir Basil
Spence, was begun in 1969 and completed in 1977.
BackNew Zealand falcon or karearea (Falco
novaseelandiae)
Sometimes called the bush hawk, the New Zealand falcon is
the most fearless of all our nation’s birds. An adaptable hunter
and a determined solitary predator, the falcon hunts small
birds and animals and can attack at speeds of up to 200kph.
The falcon is a high-country bird, seldom found north of
Rotorua, that favours isolated bush-clad mountain valleys.
Marlborough rock daisy (Pachystegia insignis)
This is a small spreading shrub unique to Marlborough and
North Canterbury. The plant is a distinctive feature of the
dry inland valleys of Marlborough with its thick leathery leaves
and large, spectacular flower heads. It grows in inaccessible
places such as cliff sides and the edges of steep scree slopes,
and can flourish in areas from sea level to 1200 metres.
Flowering red tussock (Chionchloa rubra)
There are 13 species of tussock grass in New Zealand, and
red tussock, which has a distinct red tinge to its leaves, is
found in both the North and South Islands. Tussock flowers
intermittently, is primarily found in alpine areas, and can live
for up to 200 years.
Mount Tapuaenuku, Inland Kaikouras
The highest peak in the South Island’s Inland Kaikoura range,
Mt Tapuaenuku is 2,885 metres high and dominates the
surrounding countryside. The view of the mountain on the
$20 note is from the east side of the Inland Kaikouras, looking
up from the Awatere Valley floor.
Explaining Currency: New Zealand’s bank notes and coins 11
Fif ty dol lar note
Fron tSir Apirana Ngata (1874-1950)
Sir Apirana Ngata played a significant role in the revival of
the Maori people and culture during the early years of the
twentieth century. He was the first Maori to graduate from a
New Zealand university, was an accomplished leader of the
Young Maori Party and was an elected Member of Parliament
for 38 years. Ngata was respected by both Maori and Pakeha
and provided a focus for a social movement that rejuvenated
Maori culture. He was also a driving force behind the revival
of his own tribe, Ngati Porou.
Porourangi meeting house
Designed by Sir Apirana Ngata himself, the Porourangi
meeting house stands at Waiomatatini Marae, near Ruatoria
on the North Island’s east coast, and is a showcase for Maori
art.
Pureora Forest Park
Pureora Forest Park, established in 1978, covers 72,335
hectares close to Taupo in the central North Island. The park
takes its name from nearby Mount Pureora (1130 metres). It
is one of the most ecologically significant and beautiful forests
in New Zealand and is home to a large population of kokako.
Pureora has a dense interior with a huge variety of trees,
shrubs, epiphytes and vines forming an almost impenetrable
mass. Emergent podocarps include rimu, miro and matai,
some of which may be over 1000 years old.
Supplejack or kareao (Ripogonum scandens)
Supplejack leaves are eaten by kokako, and the plant forms
impenetrable thickets used by the birds for nesting. It can
grow up to 5 cm a day in summer. Supplejack produces
bright red berries once it emerges from the shade of the
forest canopy.
Sky-blue mushroom (Entoloma hochstetteri)
This mushroom, notable for its bright blue colour that fades
with age, grows throughout New Zealand in decomposing
plant remains.
Tukutuku pattern
The tukutuku pattern was designed by Sir Apirana Ngata
and is known as “poutama porourangi”. “Poutama” is the
style of tukutuku pattern meaning “stairway to heaven” and
“Porourangi” is the name of the Ngati Porou meeting house
which features the pattern.
BackKokako or blue wattled crow (Callaeas
cinerea)
The kokako is a large native bird with a distinctive steel-grey
body and a black face ‘mask’. The variety pictured on the
note is the South Island kokako. Kokako are much larger
than a tui, and prefer to hop up trees to gain enough height
to be able to glide. They seldom fly further than 100 metres.
12 Explaining Currency: New Zealand’s bank notes and coins
Hundred dol lar note
Fron tErnest, Lord Rutherford of Nelson (1871-1937)
Internationally recognised as the ‘father of the atom’, Ernest
Rutherford changed the basic understanding of atomic
science on three occasions: he explained the perplexing
problem of naturally occurring radioactivity, determined the
structure of the atom, and changed one element into another.
Nobel Prize medal and diagram
The Nobel Prize in Chemistry, which Rutherford received in
1908, is represented on the note. Overlaying the medallion
is a graph plotting the results from Rutherford’s investigations
into naturally occurring radioactivity.
BackYellowhead or mohua (Mohoua ochrocephala)
The yellowhead, sometimes known as the bush canary, is a
diminutive and colourful bird. It is found in tracts of native
bush throughout the South Island, preferring the canopies
and sub-canopies of beech forests.
Red beech or tawhairaunui (Nothofagus fusca)
Beech forests are one of the two main types of forest in New
Zealand. Red beeches grow up to 30 metres high and are
named for the colour of the young tree’s leaves. Favouring
warmer and more fertile sites than do other beeches, their
red wood is considered to be the most durable. Red beech is
found in both North and South Islands and is the favoured
habitat of the yellowheads in the Eglinton Valley.
Eglinton Valley
Located within the Fiordland National Park on the Te Anau-
Milford Sound highway, the Eglinton Valley is home to a
particularly fine stand of red beech and a thriving population
of yellowheads.
South Island lichen moth (Declana egregia)
Found in Fiordland beech forests, this distinctively patterned
moth blends perfectly with the lichens that cling to the trunks
of the trees. The caterpillar form is strikingly coloured but is
just as skilled at disguising itself.
Explaining Currency: New Zealand’s bank notes and coins 13
New Zealand’s coinsHow a re ou r co in s made?Coins are made in two stages. To start with, blank circles are
cut from long sheets of metal. These blanks become coins
when they pass through stamping machines, which apply
huge pressure to impress the distinctive “head” and “tail”
features. New Zealand’s coins have recently been made at
the South African Mint, although at various times in the past
the Royal Mints of Britain, Canada and Australia have
manufactured our coins.
Although we usually refer to our coins as silver or gold, they
are actually made from a mixture of different metals and
contain neither silver nor gold. The ‘silver’ coins (50, 20, 10
and 5 cent pieces) are a cupro-nickel compound of 75 percent
copper and 25 per cent nickel. The gold-coloured $1 and $2
coins are struck in an aluminium-bronze alloy of 92 per cent
copper, 6 per cent aluminium and 2 per cent nickel. Coins
last, on average, for about twenty years.
Forgery of coins is fairly uncommon, simply because all the
work in forging a coin is hardly worth the small reward!
Nevertheless, all designs on a real coin should be clearly
defined, and it should have a distinct ring when dropped on
a table-top, rather than a ‘thud’.
The Reserve Bank accepts for exchange any demonetised
coins and notes (i.e. currency no longer in circulation) at its
Wellington head office. This includes 1 and 2 cent coins,
which were phased out in 1989 and demonetised in 1990.
In 1997 the Reserve Bank considered taking 5 cent coins out
of circulation and changing the size of the 20 and 50 cent
coins. After wide consultation with the public, it was decided
to retain the status quo. Many people wanted to keep the 5
cent coin and there was some opposition to changing the
size of the 20 cent and 50 cent coins, particularly from the
coin-operated machine industry.
Des ignsDesigns on the back of New Zealand’s coins (the “tail” side)
haven’t changed significantly since decimal currency was
introduced in 1967. A 20 cent piece featuring a Maori carving
was released in 1990, because the kiwi motif was moved to
the $1 coin. The 20 cent piece with the kiwi is still very
common though, so you are likely to see both coins.
The “heads” design featuring the Queen’s portrait was
updated in 1986 and again in 1999. When the $1 and $2
notes were taken out of circulation in 1991, they were
replaced by the gold-coloured kiwi $1 coin and the $2 coin
featuring the kotuku.
Commemora t i ve Cur rencyTo mark special occasions, or to honour special people,
commemorative coins are produced from time to time by
the Reserve Bank. These coins are legal tender (see page 3),
but do not circulate.
14 Explaining Currency: New Zealand’s bank notes and coins
New Zealand ’s co insFive cen t sAlloy: Cupro-nickel
Diameter: 19.43mm
Weight: 2.83g
Design: The last surviving member of an otherwise extinct
family of reptiles, the tuatara, native only to New Zealand, is
shown sitting on a coastal rock.
Ten cen t sAlloy: Cupro-nickel
Diameter: 23.62mm
Weight: 5.66g
Design: A Maori carved head or koruru.
Twen ty cen t sAlloy: Cupro-nickel
Diameter: 28.58mm
Weight: 11.31g
Design: There are two designs currently in usage. One
features a representation of a well-known Maori carving,
taken from the gateway of a pa in the Rotorua region in the
early nineteenth century. The carving belongs to the Arawa
people, who have given their permission to use the image
on the coin. The other coin in common usage features the
kiwi.
Explaining Currency: New Zealand’s bank notes and coins 15
Two do l l a rAlloy: Aluminium bronze
Diameter: 26.5mm
Weight: 10.0g
Design: The kotuku (white heron) is one of New Zealand’s
rarest birds and is held in particularly high regard in Maori
mythology.
Fi f t y cen t sAlloy: Cupro-nickel
Diameter: 31.75mm
Weight: 13.61g
Design: The barque Endeavour, commanded by Captain
Cook, sailing south, with Mount Taranaki or Egmont in the
distance.
One do l l a rAlloy: Aluminium bronze
Diameter: 23mm
Weight: 8.0g
Design: New Zealand’s national bird, the kiwi, brings reality
to the colloquial term, ‘Kiwi Dollar’.
16 Explaining Currency: New Zealand’s bank notes and coins
1840
Standard gold, silver and bronze British coins, as well as other
foreign coins, circulate freely in New Zealand.
1857—1881
Coin shortage means that some retailers issue their own
tokens.
1897
British coinage becomes New Zealand’s official currency.
1914
Gradual withdrawal of gold coin from circulation.
1933
New Zealand introduces its own coinage.
1934
Reserve Bank of New Zealand issues first series of bank notes.
1935
British coinage ceases to be legal tender in New Zealand.
1940
Second series of bank notes introduced.
1940
Bronze coins (penny and halfpenny) issued for the first time.
1947
Cupro-nickel coins first appear in circulation, replacing silver
coins.
1967
Change to decimal currency. Third series of bank notes issued.
1981—1983
Fourth series of bank notes issued.
1989
Stopped issuing 1c and 2c coins. Demonetised in April 1990.
1990
New Maori carving 20 cent coin issued.
Currency t imel ine1991
$1 and $2 coins issued. $1 and $2 notes demonetised in
April 1993.
1992—1993
Fifth series of bank notes issued, bearing first new designs
since 1967.
1999—2000
Sixth series of bank notes issued in polymer.
Explaining Currency: New Zealand’s bank notes and coins 17
Ear l y daysBefore the first Europeans arrived in New Zealand, Maori did
not use currency. Items of value were traded by barter. When
Europeans first settled here, Maori and Pakeha traded in this
way as well, until coins started to appear around the 1830s.
European colonists brought with them a variety of coins -
mostly British, but some French, Dutch and other currencies
as well - and started using them for buying things. There
weren’t many bank notes around at that time, generally
because the notes were of higher value than were needed
for transactions. Early bank notes were issued by individual
banks and payable only
by those banks. At first,
there were few printing
facilities in New Zealand,
so the durability of coins
was a real advantage.
In 1849, William Hobson,
New Zealand’s first
Governor, proclaimed
that British laws should
apply to New Zealand
and currency became subject to the Imperial Coinage Act of
1816. Because of this Act, coins in use became legal tender.
Due to a shortage of coins in 1857 and especially copper
coins, 48 traders throughout New Zealand (mostly retailers
such as merchants, grocers, drapers and milliners) decided
to issue their own penny and halfpenny tokens, some of which
circulated until 1881. Tokens were profitable for the traders
because the cost of producing them was well below their
face value and many were never cashed in because they were
easy to lose. They were a good source of advertising too, as
each token carried the business’s name.
A mixture of foreign coins was used from 1879 up until 1897,
when the Imperial Coinage Act made British coins New
Zealand’s official currency. At this time, British coinage was
already one of the two ‘common’ currencies, along with
Australian gold and silver coins.
By the late nineteenth century, bank notes were becoming
more common. By then, there were six banks operating in
New Zealand, each issuing its own notes. The problem with
this was that none of the notes being issued by the various
banks were the same size or design and there was a large
variety of different notes for each of the common
A brief his tory of New Zealand’scurrency
One of the notes printed by King Tawhiao (1825-1894) forhis Bank of Aotearoa. The notes were never circulated.Tawhiao was commemorated with a portrait on the firstReserve Bank note issue (below).
18 Explaining Currency: New Zealand’s bank notes and coins
denominations. It wasn’t until 1924 that banks finally co-
ordinated the size and colour of notes. A bank was not
obliged to accept another bank’s notes either, although most
usually did.
In 1934, the Reserve Bank of New Zealand was established
as New Zealand’s central bank and was given sole authority
by the government to issue bank notes. This ended circulation
of the trading banks’ notes.
The Rese rve Bank i s sues bankno te sThe first Reserve Bank notes were issued on the day the
Reserve Bank of New Zealand was established , 1 August
1934.
These first notes were supposed to be only temporary, as
they had been hastily designed. A committee to prepare the
designs had been formed just the year before and there had
been heated debates over what the notes should look like.
The designs that the committee finally came up with included
features from the Bank of New Zealand notes that were
circulating then.
The designs included a portrait of the Maori King Tawhiao
(who had attempted unsuccessfully to issue his own notes in
1885), a kiwi, and the Arms of New Zealand. The notes
included the signature of the first Governor of the Reserve
Bank, Leslie Lefeaux. All the notes carried the same design,
but different colours distinguished denominations. Notes of
10/- (ten shillings), £1 (one pound), £5 and £50 were issued,
coloured orange, mauve, blue-green and red respectively.
The Reserve Bank’s second note issue was in 1940, timed to
coincide with New Zealand’s centennial celebrations. These
notes had quite different designs for each denomination, but
were the same colours as before, except for slight changes
to avoid confusion between the 10/- and £50 notes. The
Reserve Bank’s Chief Cashiers signed this and following note
issues. These notes remained in circulation up until the change
to decimal currency in 1967.
Although the Reserve Bank issued bank notes, for many years
the New Zealand Treasury was responsible for designing and
issuing coins. The first distinctively New Zealand coins were
introduced in February 1933 as a result of a proclamation
issued under the Coinage Act in that year. Minted by the
Royal Mint in London, these coins were the same as the
weight, size and denomination of British coins. Silver coloured
coins, made of an alloy of 50% silver and 50% copper, were
issued from 1933, and bronze pennies and halfpennies were
introduced in 1940. In 1947 the silver coloured coins were
changed to an alloy of copper and nickel when silver became
too costly.
It wasn’t until 1989, when government services were
rationalised, that the Reserve Bank gained authority over
coinage. At the same time, one and two cent coins were
withdrawn from circulation and ceased to be legal tender in
early 1990.
The changeove r t o dec ima lcu r r encyThe concept of decimal currency had been discussed for a
long time in New Zealand. Way back in 1933, a changeover
to decimal coinage had been suggested by the New Zealand
Numismatic Society. The attraction of decimal currency was
its simplicity when doing calculations. By contrast, the
Above: The second series five pound note.
Mr Dollar
Explaining Currency: New Zealand’s bank notes and coins 19
with a distinctive New Zealand look. The designs of the notes
were changed slightly in 1999 when the Reserve Bank
introduced polymer bank notes. These designs are detailed
on pages 8-12.
Defac ing bank no t e sThe Reserve Bank Act 1989 says that “No person shall,
without the prior consent of the Bank, wilfully deface,
disfigure, or mutilate any bank note.” A person can be fined
up to $1,000 if caught defacing a bank note.
Are damaged no t e s wo r thany th ing?If you come across a badly damaged bank note, don’t throw
it away, as it will normally have some value. The Reserve
Bank is liable to pay on currency it issues, provided that the
note is not so badly damaged that it is unrecognisable. In
extreme cases, individual assessments of notes may need to
be made. As a rule of thumb, if you have half a note, the
Reserve Bank will pay half its value. To receive payment on a
damaged note, you need to present it to a bank or to the
Reserve Bank in Wellington.
‘imperial’ system of currency was complicated and difficult
to master. Under the imperial system, pounds were divided
into twenty shillings, and subdivided further into 240 pence
(making twelve pence per shilling). In 1933, decimal currency
was rejected because it would have been too expensive to
put in place at that time, especially as New Zealand was in
the midst of the Great Depression.
In 1957, a special committee was set up by the Government
to take another look at the pros and cons of decimal currency.
This committee supported the introduction of the decimal
system and paved the way for New Zealand’s move to decimal
currency. In August 1963, the Government announced that
10 July 1967 would be ‘DC Day’, and a massive publicity
campaign was organised to smooth the shift from the imperial
to decimal system.
Public discussions were held as to what the new decimal unit
might be called, and suggestions such as the “kiwi” and the
“zeal” were debated before the “dollar” was finally settled
upon. Many New Zealanders remember “Mr Dollar”, a
cartoon character that symbolised the changeover. On DC
Day, dollars and cents replaced pounds, shillings and pence
as New Zealand’s units of currency.
In 1990, the Reserve Bank decided to completely revamp the
appearance and features of New Zealand’s bank notes - the
first overhaul since the introduction of decimal currency in
1967. The result, after the Reserve Bank had consulted widely
with the New Zealand public, was an all-new series of notes
Reproduc ing o r im i t a t i ngcu r r encyIt is an offence to reproduce or imitate currency without the
prior consent of the Reserve Bank. The Reserve Bank Act
says that you cannot “make, design, engrave, print, or
reproduce; or use, issue, or publish any article or thing
resembling a bank note or coin or so nearly resembling or
having such a likeness to a bank note or coin as to be likely
to be confused with or mistaken for it”.
Real notes fluoresce under ultraviolet light. An operatorin the Reserve Bank checks a note for validity.
For further information please contact:
Lisa Weekes
Corporate Affairs Section
Reserve Bank of New Zealand
PO Box 2498
Wellington
Telephone 04 471 3767, fax 04 471 2270
email: [email protected]
Visit our web site www.rbnz.govt.nz
May 2000