Straits dollar

The Straits dollar was the currency used in the British colonies and protectorates in Malaya and Borneo, including the Straits Settlements until 1939.

History

In the early nineteenth century, the most common currency used in the East Indies was the Spanish dollar, including issues both from Spain and from the Spanish colonies, most significantly Mexico. Locally issued coinages included the Kelantan and Trengganu keping, and the Penang dollar.

In 1837, the Indian rupee was made the sole official currency in the Straits Settlements, as it was administered as part of India. However, Spanish dollars continued to circulate and 1845 saw the introduction of coinage for the Straits Settlements using a system of 100 cents = 1 dollar, with the dollar equal to the Spanish dollar or Mexican peso. In 1867, administration of the Straits Settlements was separated from India and the dollar was made the standard currency.

From 1898, the Straits dollar was issued by a new Board of Commissioners of Currency and private banks were prevented from issuing notes. Its value depreciated over the next eight years and was then pegged at two shillings four pence sterling in 1906.

The Straits dollar was replaced at par by the Malayan dollar in 1939.

Coins

The first coins issued for the Straits Settlements in 1845 were ¼, ½ and 1 cent denominations in copper. They were issued by the East India Company and did not bear any indication of where they were to be used. A second issue of the same denominations was produced in 1862 by the government of British India. These bore the inscription "India - Straits".

In 1871, silver coins were issued in the name of the Straits Settlements for 5, 10 and 20 cents, followed by copper ¼, ½ and 1 cent the next year and silver 50 cents in 1886. Silver dollars were first minted in 1903.

A 3 page special issue of the Straits Settlements Government Gazette published in Singapore on 24 Aug. 1904, contained the following proclamation by then Governor, Sir John Anderson."From 31 Aug. 1904, British, Mexican and Hong Kong Dollars would cease to be legal tender and would be replaced by the newly introduced Straits Settlements Dollar."

As a consequence of the depreciation in the dollar's value, the silver content of the coinage was reduced from 1907. The last ¼ cent coins were issued in 1916. Dollars were last struck for circulation in 1920, with 50 cents production ending in 1921. The remaining coins continued in production until 1935.

Banknotes

The Board of Commissioners of Currency introduced 5 and 10 dollars notes in 1898, followed by 50 and 100 dollars in 1901 and 1 dollar in 1906. Emergency issues of 10 and 25 cents were made between 1917 and 1920. 1000 dollars notes were issued in 1930 but during the 1930s only 1, 5 and 10 dollars notes were issued.

traits Settlements government issues (1899 - 1942)

Queen Victoria (1837 - 1901)

The Government of Straits Settlements, was first authorised to issue currency notes by Ordinance VIII of 1897, which came into operation on 31 August 1898. These notes, although dated 1 September 1898, were not issued to the public until 1 May 1899. Both the Chartered Bank and Hong Kong and Shanghai Bank continued to issue banknotes, which circulated side by side with the official currency. All notes were freely exchangeable with the Mexican dollar or the various other silver coins that were legal tender in the Colony.

King Edward VII (1901 - 1910)

King Edward ascended the throne in January 1901. In the previous issue the 5-dollar note had been of almost the same size and design as the 10-dollar. To make recognition more simple it was reduced in size. The series dated 1 February 1901 were printed by Thomas de la Rue & Co. Ltd. of London.

In 1903, a dollar-sized coin in silver was minted specially for the Straits Settlements, and this became the standard unit of value. All other silver dollars at that time circulation were demonetized by 1904. A step rise in the price of silver, however, soon forced the government to call int the first issue of this Straits dollar and to replace it with a coin of lower silver content.

During the change over period, fear of a shortage of coin led to the introduction of the one-dollar note, fixed at an exchange rate against gold instead of silver. To effect this, the British gold sovereign was for the first time declared legal tender, and the Straits dollar was given an arbitrary value of two shillings and four pence sterling. This dollar note proved so popular that it was retained in all future issues, so that to a very large extent it replaced the need for the silver coin.

By the end of 1906, the currency circulation had risen to $21,866,142, while that of the private banks had fallen to $1,329,052 (20th Century Impressions of British Malaya p.138). The one-dollar notes, which were dated 1 September 1906, were printed by the London firm of Thomas de la Rue & Co. Ltd.. A five-dollar and a ten-dollar none both dated 8 June 1909, were printed Thomas de la Rue & Co. Ltd..

King George V (1910 - 1936)

During this reign the range of currency notes was extended up to one thousand dollars for the convenience of inter-bank clearing transactions. In 1915, it was decided to make a complete change in the design of the 50, 100 and 1000 dollar notes. These denominations were first issued to the public in February 1920, October 1919 and May 1917 respectively. They were printed by Thomas de la Rue. A 10,000 note was first issued in October 1922. This was not available to the public, but was used exclusively in inter-bank transfers.

King Edward VIII (1936)

No special issue of notes was made during this brief reign.

"'King George VI (1936 - 1952)

In September 1933, Sir Basil Blackett was appointed by the Secretary of State for the Colonies to lead a commission to consider the participation of the various Malay States, including Brunei, in the profits and liabilities of the Straits Settlements currency. The Blackett Report recommended that the sole power of issuing currency for the area should be entrusted to a pan-Malayan Currency Commission. This recommendation wa adopted by the Government of the Straits Settlements, the Federated Malay States, Unfederated Malay States and Brunei. Legislation was enacted by the Straits Settlements Currency Ordinance (No. 23) of 1938, and ratified by the various states during 1939.

Out of 27,000,000 one dollar notes and 5,600,000 five dollar notes of the same series despatched to Malaya before the Japanese invasion; 25,800,000 one dollar notes and 5,000,000 five dollar notes actually arrived. Of the remainder, 700,000 one dollar notes and 500,000 five dollar notes were seized by the Germans when one of their raiders captured the SS Automedon; and further 500,000 one dollar notes and 100,000 five dollar notes were lost when the carrying ship, the SS Eumanes, was sunk.

None of these notes were ever put into circulation by the Straits Settlement Government, so that at the time of Japanese invasion they were still held in treasury vaults in Singapore and Penang.

When Penang was evacuated in December 1941, 600,000 one dollar notes and 100,000 five dollar notes were abandoned in the treasury, where they fell into the hands of the Japanese. In Singapore, 4,200,000 one dollar and 1,000,000 five dollar notes were destroyed, and 21,000,000 one dollar notes and 3,900,000 five dollar notes shipped to India for safety.

When British forces reoccupied Singapore in September 1945, they found all the abandoned notes of this series, except for the one bundle of one thousand of the notes captured in Penang, in the vaults of the Japanese sub-treasury.

All stocks were destroyed in 1946, as it was feared that the notes from the captured ship might have been handed over by the Germans to their Japanese allies, and were being hoarded in bulk, ready to be passed into circulation when the notes became current. There are no evidence that these notes ever reached Malaya. All the notes were signed by L.G. Corney, the Chairman of the Board of the Commissioners of Currency.

British Military Administration in Malaya (1945 - 1946)

British forces landed at Penang on 3 September 1945 and at Singapore on 5 September 1945 and gradually reoccupied the whole Malaya. Until 1 April 1946, the country's finances were administrated by the department of the Controller of Finance and Accounts of the Army Pay Corps, and currency was put into circulation against payment in sterling by the War Office to the account of the Board of Commissioners of Currency Malaya.

It was decided that no value whatever should be accorded the Japanese banana money then in circulation, as it had been estimated that during the three and a half years occupation the Japanese had issued a minimum of 4,000 million dollars worth of currency against a normal 1941 circulation of about 220 million (Donnison p.223). The pay service made available currency notes from 1 cent to 10,000 dollars which had been printed in Britain either before, or during, the occupation but had not previously been sent to Malaya. In addition, the 1940 ten dollars note issued by the Board of Commissioners of Currency Malaya and the old Straits Settlements notes, with the exception of denominations of 1,000 or 10,000 dollars and 10 and 25 cents, were declared legal tender. These old notes were gradually withdrawn, however, as the new issue became adequate for the country's needs.

The notes of this series from 1 cent to 10 dollars were dated 1 July 1941, those of 50, 100 and 1,000 dollars 1 January 1942, while the 10,000 dollars notes were signed and dated on the day of their issue. The Chairman for the Currency Board was H. Weisberg. The emergency issues of 10 cent with King George VI as the portrait was issued on 15 August 1940, designed and printed by the Survey Department (F.M.S.) in Kuala Lumpur with the controlled serial number. On 1 September 1940, also an emergency issues of 25 cents was designed and printed by the Survey Department with King George VI as the portrait. On 1 July 1941, a set of new regular issues, with the denomination of 1, 5, 10, 20 and 50 cents was printed by Thomas de la Rue & Co. Ltd., London with the portrait of King George VI. Also on the same date of 1 July 1941, the 1, 5 and 10 dollars notes were engraved and printed by Waterlow & Sons Ltd., London, and the higher denomination of 50, 100, 1000 and 10,000 dollars notes were printed by Bradbury, Wilkinson & Co. Ltd., Surrey, London.

Civil Administration

Civil administration was restored on the 1 April 1946; and from the same date the Board of Commissioners of Currency Malaya, was reconstituted bt the authority or Ordinance No.4 of 1946 in Singapore and Ordinance No.5 of 1946 in the Malayan Union. The Board continued to operate in the same way as before the Japanese occupation.

All notes bearing dates prior to 1 July 1941, were demonetized on 31 August 1948.

The Currency Ordinance No. 44 of 1952 of the Crown Colony of Singapore, No. 33 of 1951 of the Federation of Malaya, No. 10 of 1951 of the British North Borneo and No. 1 of 1951 of the Crown Colony of Sarawak implemented an agreement between those governments and the State of Brunei for the establishment of a Board of Commissioners of Currency to be the sole issuing authority in Malaya and British Borneo. This agreement became effective on 1 January 1952. The Board consisted of five members:

# Financial Secretary of Singapore
# Minister of Finance for the Federation of Malaya
# Governor of Sarawak
# Governor of British North Borneo
# British Resident of Brunei

and two further appointed by agreement of the participating governments. The Chairman was the Financial Secretary of Singapore.

References

* Emerson, Rupert, 1964,Malaysia A Study in Direct and Indirect Rule, Macmillan Company
* Shaw, William, 1971, Paper Currency of Malaysia, Singapore and Brunei (1849 - 1970), Museum Department of States of Malaya

External links

Standard numismatics external links
world_coin_gallery_1_url = Malaysia
world_coin_gallery_1_name = Malaysia
banknote_world_1_url = straits_settlements
banknote_world_1_name = Straits Settlements
dollarization_1_url = asia
dollarization_1_name = Asia
gfd_1_url =
gfd_1_name =
gfd_data_1_url = 4020
gfd_data_1_name = Singapore Dollar
show_gfd_excel = Y