Regional banknotes   

Even after the declaration of the National Independence in 1912, the country continued to follow the monetary system of the Ottoman Empire, adopted in 1844. The base currency in circulation remained the gold Ottoman lira, which accounted for 100 silver grosh. This situation was a natural consequence of the currency that remained in circulation after the declaration of Independence and the public deposits in that currency. Political and economic developments during WWI and foreign occupants contributed to the circulation of other currencies. The landscape of currencies in circulation during 1912-1926 would perfectly fit the metaphor of Babel in the Bible. In addition to the silver and gold ottoman currency, whose legal tender was envisaged to continue until the issue of the Albanian national currency, other gold currencies circulated in that time in Albania such as American, French, Italian, and Greek. 

Also, silver coins, which, prior to WWI equalled 5, 2, 1 and ½ gold franc of various countries. In everyday life, they were called “Korona Sermi” (silver kroner), although the monetary value had depreciated, the people had great confidence in them.  In the absence of a formal exchange rate, this horde of currencies was officially recorded in the state revenue and expenditure books. In 1920, with the internal organisation of the Albanian State and introduction of the fundamental elements of the constitution projecting free and independent institutions from foreign interventions, the first measures were taken to bring order to the monetary situation. According to the Decision of the Council of Ministers No. 273, of 6 May 1920, for the first time, it was decided that state revenues would be declared on the basis of the gold franc.

Another considerable difficulty was the absence of currency subunits. Consequently, in 1920-1921, the so-called regional banknotes were printed, guaranteed by the municipalities in some of the major cities.  The low-denomination regional banknotes were for local use only.   It was not until 1923, when the Government formalised the action in a law dated 16.1.1923, establishing the issue of regional banknotes up to 80.000 gold francs.









* Collage of regional banknotes, issued by different municipalities of Albania, in 1921-1926.

Copyright © 2004-2016 Bank of Albania. All rights reserved.