Brief History of the

Mexican Bank Note

Due to the huge mining wealth of the New Spain Viceroyalty, during the three hundred years of colonial rule in Mexico, currency consisted only of gold, silver and, in a smaller quantity, copper coins. Paper money did not appear until the 19th century in Mexico, after the independence was reached.


The political and social order of the New Spain Viceroyalty was disturbed by the Independence Revolt that started in 1810, resulting in a deep economic crisis due to the abandonment of mines (the economy's pillar) and capitals fly back to the Iberian Peninsula. Thus, the lack of currency was another problem of the torn colony. Several emergency necessity mintings and the first paper money appeared in Mexico; among these, in 1813, curious half a real pieces of orange cardboard appeared in San Miguel el Grande, Guanajuato, the issuers of which are unknown. Another background to the Mexican banknote is found in the late 18th century, at the former Spanish colony Louisiana, where banknotes in several denominations were issued.

The First Empire Banknote.

After the consummation of the Independence in 1821, Mexico adopted a monarchic government leaded by the criollo Agustin de Iturbide, who faced a terrible economic penury resulting from the eleven year war. In order to solve this situation, Iturbide tried several measures: he gave considerable support to mining production, resorted to mandatory loans, wage deductions for both civil and military personnel and tax increases; nevertheless, the results of such actions were not as expected to afford the growing Court's expenditures and proved even counterproductive by raising the Emperor's discredit. As as drastic resort, paper money was issued (December 20th, 1822). These notes -the first official issue in Mexico- are also considered the first provisional necessity banknotes in this country. These pieces are printed on a single face, on an almost square shaped white paper, bear the legend IMPERIO MEXICANO (MEXICAN EMPIRE), and were issued in 1, 2, and 10 peso denominations. The fate of the banknotes was not different from other actions taken by the imperial government. They were never accepted by the public, that was used to handling coins; furthermore, these banknotes were suitable to mishandling among officials and payers, and contributed to the government discredit. Although many reasons caused the quick overthrown of Iturbide's government, the failure of his treasury and monetary policy was vital.

The 1823 Republican Banknote.

In 1823, Mexico became a Federal Republic. The new government tried to correct the treasury mistakes made by the Empire and to restore public trust in the government's financial management. Therefore, among other actions taken, mandatory loans stopped and the imperial banknote was withdrawn from circulation. Nevertheless, the serious treasury penury was not solved and paper money was issued once more to finance the state. This time, in order to halt the popular reject to this exchange medium, it was printed on cancelled papal bulls, which were expected to be accepted due to the religiousness of the Mexican people. The result was not different from the obtained by Iturbide: banknotes were not accepted by the public and soon they had to be withdrawn from circulation.

Private Issuing Banks.

Many decades after the monetary failures by the Empire and the Republic, paper money was finally accepted in Mexico. It was not until 1864, during Maximilian of Habsburg's Empire, however, that the project of issuing banknotes was adopted again, but with different conditions: a private bank, the Banco de Londres, Mexico y Sudamerica, would issue the banknotes, whose acceptance would be optional. This time, banknotes had a great success; sometimes they were even preferred to coins.

After the Empire's collapse and the Republic's restoration, the conditions were suitable to issue banknotes, specially during the the long administration of General Profirio Diaz (1877 - 1911). At that time, a stable, functional and organized banking system according to the Credit Institutios Law of 1897 was established and there was at least one private issuing bank on each state of the country, besides the Banco Nacional de Mexico, with nationwide presence, and the Banco de Londres y Mexico, whose concession was ratified. Thus, Mexico adopted banknotes as a widely accepted exchange medium. The banknotes issued by these banks, with their corresponding metallic backing, were of 1, 5, 10, 20, 50, 100, 500 and 100 peso denominations and were manufactured by foreign specialized companies like Bradbury, Wilkinson & Company, American Bank Note Company, and American Book & Printing Company. Banknotes were finally accepted by the public.

The Banknote During the 1910 Revolution.

The Revolution against the Porfirio Diaz's government which began in 1910 would lead Mexico once again, to a currency shortage and banknotes discredit. Large amounts of coins were withdrawn from circulation and, besides, banknotes were rejected again.

General Victoriano Huerta -who led a military coup on February, 1913, that overthrew and murdered Francisco I. Madero, Constitutional President of the United Mexican States- ordered the private issuing banks to deliver the banknotes metallic backing to his government and to issue unusually large amounts of banknotes with no backing. Therefore, the painfully built Mexican banking system quickly fell to pieces together with banknotes use and acceptance.

Nevertheless, the lack of currency forced municipal authorities, military leaders and merchants, miners and land owners to issue necessity pieces. As to this, from 1913 to 1915, necessity currency reappeared in Mexico: several metallic pieces were minted nationwide, but the issues of paper money were multiplied. The first to issue this kind of pieces was Venustiano Carranza, First Chief of the Constitutionalist Army and leader of the revolt against Huerta who, in turn, authorized several chiefs to issue their own banknotes, vouchers y and cardboards to collect campaign funds.

The formal characteristics of these banknotes considerably varied; they range from high quality pieces to roughly manufactured notes. The large amount of issues and varieties worsened the Republic's monetary problem rather than solving it. These pieces, which Mexican people called "bilimbiques", had value as far as the issuer had power and authority in a given region. Upon general Huerta's defeat, the situation became more complex with the confrontation among the various revolutionary parties. The "bilimbiques" kept on devaluating their value; furthermore, new issues appeared, such as the pieces of the Mexican Provisional Government issued in Veracruz or those of the Revolutionary Convention of Mexico City. Massive counterfeit of these pieces contributed to worsen the monetary problem in Mexico and to discredit even more paper money.

As the dominion of Carranza's party consolidated, several attempts were made in order to solve the monetary problem in the country: the only valid paper money would be the issued by Carranza and, in order to avoid counterfeits, they issued more sophisticated banknotes manufactured by the American Banknote Company in New York. These banknotes were put into circulation on May 1916, while the former issues were gradually withdrawn. These pieces are known as "forgery proof". Their fate, however, was not different from the revolutionary issues, as they became devaluated and useless at the end of that year. At that period, the only safe currency was the rare and scarce coin, since paper issues were only backed by the force of arms which, in the event of a setback, would left their holders helpless.

Consequently, late in 1916, Carranza ordered workers to be paid exclusively with coins, whose minting had been restarted at the Mexico Mint. Thus, as Carranza became military strong, there was a glimpse of solution to the monetary problem in Mexico.

The Republic reconstruction posed new problems, like the establishment of a new banking system in the country. The first step towards it was to declare bankruptcy and to liquidate the former porfirian banks; the second, the establishment of a new issuer.

The Article 28 of the Mexican Political Constitution promulgated on February, 1917, establishes that the monopoly of the issue would belong to a sole Bank under government control. Nevertheless, it was not until seven years later that this bank was founded , being the issue of banknotes one of its primary functions.

The Banco de Mexico Note.

Banco de Mexico started operations on September 1st, 1925, thanks to the budget and organizational efforts of Plutarco Elias Calles, then President of the Republic. Issuing and regulation of the currency circulation were among the functions of the new Central Bank. The restoration of user's trust in banknotes was one of the major problems Banco de Mexico faced when issued its first paper money pieces, which at first were issued on a voluntary basis in order to gradually restore the use and trust on this exchange medium by the public.

The first Banco de Mexico notes were printed by the American Banknote Company in New York (ABNC), in a 180 x 83 mm. size. This first series consisted of the 5, 10, 20, 50, 100, 500 and 1000 peso banknotes. Later, from 1936 to 1942, a second transitory series was issued; this series was also printed by the New York firm, but in a smaller size (157 x 67 mm.); the 5 and 10 peso notes maintained the former designs, while the 50 and 100 peso notes adopted new ones.

Concurrently with the second series, a third one was put into circulation (1936-1978), also printed by the ABNC. The issued pieces were of 1, 5, 10, 20, 50, 100, 500, 1000 and 10000 peso denominations.

A new chapter in the Mexican banknote history begins on 1969, when the Banco de Mexico Printing Works starts operations. Thus, a new generation of Mexican banknotes appeared; these banknotes were manufactured using the latest technological advances and according to designs, iconography and conceptions different from those prevailing at that time. The fourth series (1969 1991), first of domestic manufacture, consisted of the 5, 10, 20, 50, 100, 500, 1000, 2000, 5000, 10000, 20000, 50000 and 100000 peso banknotes.

With the aim of simplifying the handling of domestic currency amounts, under a decree of June 18th, 1991, a new unit of the United Mexican States Monetary System was created, equivalent to one thousand pesos of the former unit; these unit conserved the name "peso". In order to distinguish it from the former monetary unit, for a transitory period the adjective "nuevo" (new) was used before the name "peso". The use of this adjective was omitted starting from January 1st, 1996. During 1992, Banco de Mexico issued a new series of banknotes in 10, 20, 50 and 100 peso denominations with the adjective "nuevo" before the unit's name; these banknotes maintained the same design of the former notes. At the end of this year, a new series of banknotes was printed, also bearing the name " nuevos pesos", but with new designs. This series consisted of 10, 20, 50, 100, 200 and 500 banknotes; the first three denominations are 129 x 66 mm. and the last three 155 x 66 mm.

This process concluded by eliminating the adjective "nuevo" (new) from the unit's name on the last series of banknotes issued by Banco de Mexico (from 1994 to date). This series kept the same designs as the former one, but the term "nuevos" is no longer placed before the word pesos. Banknotes of 10, 20, 50, 100, 200 and 500 pesos conform this series