Non-decimal currency

A non-decimal currency is a currency that has sub-units that are a non-decimal fraction of the main unit, i.e. the number of sub-units in a main unit is not a power of 10.

Contemporary non-decimal currencies

Today only two countries in the world use non-decimal currencies. Both of these countries are in Africa. These are Mauritania (1 ouguiya = 5 khoums) and Madagascar (1 ariary = 5 iraimbilanja).[1] However these are only theoretically non-decimal, as in both cases the value of the main unit is so low that the sub-unit is too small to be of any practical use and coins of the sub-unit are no longer used.

The official currency of the Sovereign Military Order of Malta, which retains its claims of sovereignty under international law and has been granted permanent observer status at the United Nations, is the scudo. The scudo is subdivided into 12 tarì, each of 20 grani with 6 piccioli to the grano. It is pegged to the euro (at a rate of 1:0.24).

All other contemporary currencies are either decimal or have no sub-units at all.

Historic non-decimal currencies

Historically, the use of decimal sub-units was the exception rather than the rule. Decimalised currencies show an advantage in accounting, because amounts are written down and calculated using the decimal numeral system (but when another numeral system is used, such as the vigesimal system that was common among ancient Mesoamerican civilizations or the sexagesimal system used by the ancient Mesopotamians, this advantage disappears). However, decimalised currencies also have disadvantages. The principal advantage of most non-decimal currencies is that they are more easily divided, particularly by numbers such as 3 and 8, than decimal currencies. A currency with 100 minor units to the major unit is divisible neither into 3 nor into 8, and furthermore 100 may be an uncomfortably large number for some poorly educated people to deal with. For example, one-third of an Austrian Gulden (of 60 Kreuzer) was 20 Kreuzer while a third of a dollar is 33.333 cents. This divisibility is useful when trading and when sharing out sums of money. For these reasons, many states chose in the past to adopt non-decimal currencies based on divisions into sub-units such as 12 or 20, sometimes with more than one tier of sub-units.

There is a second, more fortuitous, way in which non-decimal currencies emerged. Often multiple currencies would circulate concurrently in an economy, with non-decimal exchange rates between them. For example, the Reichsthaler/ rixdollar/ riksdaler/ rijksdaalder/ rigsdaler were widely accepted as a common accounting unit which represented a variety of local coins in Stockholm, Copenhagen, Antwerp, and Cologne. Inflation developed locally, with changing subdivisions. For instance the Riksdaler was equivalent to 2 silver dalers in Sweden in 1700, but after the 1715-19 devaluation of the silver daler coin until 1776 one Riksdaler equated to 3 daler silvermint. Most currencies made no distinction between units of accounting and units represented by coins and thus created such shifts. (A similar example in the UK was the guinea, which was worth slightly more than one pound sterling.)

In general, when the major unit was, say, a gold coin and the minor units were silver or copper coins, then when the relative values of the metals changed, perhaps because of an increase or decrease in the supply of one of the metals, then the number of minor units equivalent to one major unit would also change.

Thus the following list does not give a complete picture: it is a list of examples picked from different periods. Many of the subdivisions given below underwent historical changes.

The Russian ruble is often said to have become the first decimalized currency when Peter the Great established the ratio 1 ruble = 100 kopecks in 1701. The Japanese were in some sense earlier calculating with the silver momme and its decimal subunits - but then the momme was not a coin but a unit of weight equivalent to 3.75 g: accounting was by weight of silver. The British pound sterling was the last major currency to be decimalized, on 15 February 1971. The Maltese waited just one year (1972) before following suit and Nigeria followed in 1973. An early proposal for decimalizing the pound in the 19th century envisaged a system of 1 Pound = 10 florins = 100 dimes = 1000 cents. However the only step taken at that time was the introduction in 1849 of a florin (two shillings) coin (the earliest examples bore the inscription "One Tenth of a Pound").

List

A partial listing of former non-decimal currencies (giving only units of account):

In the Eurozone, in the interval between fixing the conversion factors between national currencies and the euro and the introduction of euro coins, the national currencies were non-decimal subdivisions of the euro.

Fictional non-decimal currencies

See also

References

  1. ↑ "Malagasy Ariary". famouswonders.com. Retrieved 2016-12-13.
  2. 1 2 3 4 5 Walkingame, Francis (1874), The Tutor's Assistant, pp. 95–99
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