Money, Money, Money! Chapter 3

Three thousand years ago, the people living around the Mediterranean Sea began to use coins made of precious metals, such as gold and silver. Coins were always the same weight, so you knew exactly how much gold or silver you were being paid.

In Turkey, the first coins were small pellets, marked with a simple design that indicated the coin's weight. But it didn't take people long to figure out that you could shave tiny pieces of metal off a pellet and no-one would notice. If you sliced enough pieces off pellets, you saved a lot of money!

In China, over 4,000 years ago, an even better system had already been invented. The Chinese had realised that it wasn't necessary to make coins out of gold and silver.
As long as everyone agreed that the coins had a particular value, they could be manufactured from any metal, even a cheap one.

The Chinese government made their coins out of iron, and stamped them with a certain value. It was an ideal way to stop people slicing off pieces of precious metal from valuable coins
A thousand years ago, the Chinese invented another money system. Carrying so many coins around was a problem, especially if you wanted to buy something really expensive. Many horses were needed to carry sacks of coins! So paper money was invented.

Unfortunately, paper money was not only easier to carry around, it was also easier to copy! People who copied paper money were known as forgers.

The governments of countries that used paper money had to use many different paper-printing techniques to make the paper money difficult to copy.

Nine hundred years ago, the Chinese government started to use special paper and began to print its paper money in colour, to make it harder to forge. Each note was printed with its own number, called a serial number. This made its easier to find out if a note had been copied or not.