COINAGE AND CURRENCY
The Falkland Islands pound (ISO 4217 currency code FKP) is pegged to the pound sterling at par. Both currencies are used there. The islands have their own banknotes. The front of all denominations feature a portrait of HM Queen Elizabeth II, the Falklands’ coat of arms, a map of the islands, penguins and sea lions. On the reverse there are pictures of Government House and Christ Church Cathedral. The different denominations are separated by colour.
- £5 red
- £10 green
- £20 brown
- £50 combination of blue, green and red
Coins are the same as corresponding British coins in size and composition but differ that the back of the coins feature different Falklands wildlife.
Banking
There is no central bank in the Falklands but Standard Chartered Bank has a branch that serves retail, commercial and wholesale banking.The constitution requires the Falkland Islands governor to approach a British secretary of state for approval of any bill that affects the currency of the islands relating to the issue of banknotes or 'any banking association or altering the constitution, rights or duties of any such association', thus giving the British Government the power to prevent the islands from declaring themselves a tax haven or from establishing a central bank.
History
In the early days of Stanley there was a great demand for ‘specie’, money in the form of coins rather than notes. In 1845 many English coins were circulating, predominately sovereigns, crowns, three shilling and one shilling pieces, sixpences, half-crowns, and four-penny pieces. Governor Moody began issuing a form of promissory note or paper currency. These were written out and signed as required. There were also doubloons in circulation but these were less common by the 1850’s and American coinage the ‘Eagles of the United States’ which remained important for many years due to American shipping.
People tended to hoard gold, reluctant to part with any they received before disposing of it at favourable periods at a premium abroad despite there being interest offered by the Savings Bank. The cost of renewing gold stocks made it give way to cumbersome silver so to relieve the situation in 1899 the Government issued paper currency within the colony. £1000 worth of £5 and £1 notes became legal tender on 16th October 1899 and were soon circulating in exchange for commodities and services by the people of the town and camp. By the end of the year only £15 worth was left in the treasury. In 1891 , the Colonial Secretary reported that 'a large number of shepherds and others from several stations have, during the year, left the Colony to settle in Patagonia, which country offers great scope for farming enterprise. This caused rather heavy withdrawals from the Savings Bank, for many of the shepherds possess considerable deposits, the savings of many years earnings in the Colony'.
In 1971 decimalisation, the pound was divided into subunits of 100 pence. The peso was circulated during the 1982 Argentine occupation.
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