The Colonial Paper Money of Sierra Leone
Sierra Leone has a modern history very similar to many African nations and also a modern history similar to many colonies of the British Empire. For readers who are familiar with the development of British colonies throughout the world, many aspects of Sierra Leone’s history will be familiar. However, there are certain characteristics of the development of this nation that are peculiar to the west African coast, particularly matters relating to the slave trade. Some of the principal events in the history of Sierra Leone will be touched upon in this study, but many details will be omitted. As this is a study of currency issued in colonial Sierra Leone, principally of paper money, only those aspects of the Sierra Leone’s history necessary to put the issues into context will be mentioned.
The Portuguese were the first Europeans to trade with the natives of West Africa and their trade soon encompassed the area now known as Sierra Leone. In 1462 Pedro de Cintra reached Sierra Leone and from that time trade with the area slowly developed. Through the sixteenth to nineteenth centuries the area was continually raided for slaves, although many of the natives were themselves responsible for selling conquered people into slavery. During these years, the currency of payment was initially trade goods but, after a time, goods were measured in ‘bars’ of metal.
Europeans paid for slaves in manufactured goods, otherwise unobtainable. Though ‘country cloths’, narrow cotton strips sewn together and dyed, were woven, imported textiles were in great demand. More textiles were imported than any other commodity; by the end of the eighteenth century Manchester cottons were supplanting East India. Guns were specially manufactured in Birmingham for the West African market. Imported tobacco was preferred to the inferior kind grown on the Coast, rum and brandy to palm wine.
Payments were made in ‘bars’. Originally a bar of iron given in barter, the bar became by mid-seventeenth century a conventional medium of exchange: so many pieces of calico or haft, so many guns or barrels of rum, were valued at so many bars. As the prices of goods bought in Europe fluctuated more than the rate of bars fixed on the Coast, the trader could usually make a profit by combining the goods making up his bars so that what he had bought cheap predominated. So for a slave valued fifty bars one trader might offer a consignment chiefly of tobacco, another of copper basins, as he could make most profit.
Customers, in return, learnt to insist on taking a certain proportion of high-valued bars. They also learnt to sell their slaves in lots, not individually, so forcing the purchaser to take the sickly with the healthy. They would refuse to do business without first being given free drinks. As they grew experienced in trade slave prices rose: men were bought at Bence Island for eighteen to twenty-four bars in 1678, for forty to sixty in 1725. By 1787 the price of a slave in sterling in Sierra Leone was over five times what it had been a century earlier. (Fyfe, page 9.)
Trade in West Africa was underpinned by the slave trade and as opposition to slavery grew, imaginative men sought ways to combat and ameliorate the effect of slavery. One of these men was Granville Sharp, an English philanthropist. In 1787 Sharp decided to create a colony in Africa to which former slaves could be sent. If they could not be repatriated to their specific area of origin, they could at least remain in Africa. Sharp sent settlers to the colony which was to be called ‘The Province of Freedom’. The first community consisted of about four hundred settlers who were predominantly freed slaves living in England, although approximately one hundred were English colonists . On arrival in Sierra Leone they negotiated a land grant from a local tribal leader, King Tom, and founded the settlement of Granville Town.
Sharp, in creating his settlement in Sierra Leone, wanted the colonists to do away with money as, like many in Britain, he felt that some great evils of society were due to the monetary economy. ‘He proposed instead a medium of exchange based on individual labour , with a special tax on those too proud or idle to work. He was ready to take in any industrious European (if Protestant), particularly those who could teach a craft. So the sailing lists included about twenty artisans.’ (Fyfe, page 17.)
The settlement was not successful. By March 1788 only one hundred and thirty settlers remained, as many had died, or drifted away to work on passing ships. A second group of thirty nine settlers was sent by Sharpe to the settlement but twelve died on the voyage and another four stayed at various destinations en route to the settlement. Sharpe, a religious man, forbade drunkenness on the second voyage, asking Captain John Taylor to fine anyone found in breach of the regulation. In an effort to instil the value of trade in the new colonists, and to support Sharp’s view of a non-cash economy, Captain Taylor had bought trade goods with the money supplied by Sharpe and these were used to acquire goods on the way to the settlement and in the settlement.
As King Tom had died, the new King repudiated the treaty signed by his predecessor. Consequently, Captain Taylor negotiated a new treaty, although he was not entitled to do so, and this was signed on 22 August 1788. (The treaty was signed by settlers, not by Taylor.) The settlement remained unsuccessful, even after the arrival of the new colonists. Some settlers returned with Taylor to London on his departure from the colony and constant bickering between the settlers, illness, criminal activities by individuals, and disputes with the local tribes meant that the colony was making poor progress. Ultimately Granville Town was burnt down by a local chief after his own village had been destroyed in one of the many ‘incidents’ that wracked relations between the colonists and the locals.
Sharp was not deterred by the destruction of his colony and continued to petition the British Government for more funds to support the settlement, but with no luck. The Treasury had supported the first settlement and would support the colony no more. Sharp turned to private sponsors and one that responded to his appeals was Henry Thornton. As a result of their collaboration a scheme was proposed to form the ‘Sierra Leone Company’ , which would have exclusive trading rights granted to them by the British Parliament. The proposal was successful and the adventurers proceeded to promote their plan. Thornton and his friend, William Wilberforce, bought a vessel, the Lapwing, to take the new colonists to Sierra Leone. The ship sailed in December 1790 and arrived at the colony in January 1791.
The old colonists, who had fled the destruction of Granville Town, returned to their settlement and were joined by the new settlers, but the re-established colony continued to struggle. However, promise of stability was increased with the anticipated arrival of a large number of colonists. During the American War of Independence, many slaves had joined the British, sometimes forming companies of ‘Guides and Pioneers’. After the war, some of the slaves went to Britain and some went to Nova Scotia. Those that settled in Nova Scotia found life uncomfortable and they were often exploited by employers in a country where slavery was still legal. Their plight came to the attention of British abolitionists and plans were made to offer the ‘Nova Scotians’ settlement in Sierra Leone. After much organization, two ships loaded with former slaves who had been transplanted to Nova Scotia sailed for Sierra Leone in January 1792.
Although Granville Town had been re-established, the new colonists founded a new settlement, which they named ‘Freetown’. However, even with the good intent and ambition of the new settlers, disease and poor conditions continued to take a severe toll on the colonists. While people died almost daily, incompetence, idleness, and inexperience in agriculture saw no progress in the colony.
Although Henry Thornton was sympathetic to the ideals and ambitions of Sharp, Thornton did not have Sharp’s aversion to money. Believing that the use of ‘bar’ money made it difficult for individuals to save small amounts of money and that the unregulated use of bars encouraged fraud, Thornton had silver and copper coinage minted for the Company at the Soho Mint in Birmingham. The coins were denominated in dollars and cents (but included pennies) and the first issue was dated 1791. A lion adorned the obverse of the coin, along with the words ‘Sierra Leone Company, Africa’, while on the reverse were clasped black and white hands. The choice of ‘dollars’ as a currency, as opposed to sterling, was because of a desire to base the coinage on the Spanish American dollar; although each dollar was composed of sixty pence or five shillings.
The first consignment of coins did not reach the colony until 1792. Lieutenant John Clarkson R.N., who had escorted the Nova Scotians to the Sierra Leone and who had the administration of the colony thrust upon him due to the failure of the arrival of the new Governor, decided to issue paper money until the coins arrived. The paper notes were backed by bills of exchange on the directors of the company. Interestingly, the local natives accepted the notes when bringing produce for sale. It can only be wondered if this was their first experience with paper money. None of the paper money issued by Clarkson, which seems to have been issued in numerous denominations, appears to have survived.
Anna Maria Falconbridge, the wife of Alexander Falconbridge an agent of the Sierra Leone Company, accompanied her husband to Sierra Leone and wrote numerous letters to a friend in England. The letters were later published in a book . In a letter dated 28 December 1792 Mrs. Falconbridge wrote:
We have little gold or silver among us; that want is substituted by paper notes, from five dollars down to six-pence, signed by the Governor or Mr. Dawes. —The credit of this medium is established by giving bills of exchange, to the holders, upon the Directors, at a trifle more than eleven per cent. discount, which is only the difference between sterling and currency, a guinea being nominally twenty-three shillings and four pence here; it is taken in payment for goods at the Company’s store, and its reputation is now so good, that neighbouring Factories and casual Traders receive it for what our settlers purchase for them. (Coleman)
The first coins ordered by the Company from the Soho Mint were in quantities insufficient to meet the demands of the colony. Although the coins quickly disappeared from circulation, there remained a need for paper currency even when the coins were first delivered.
The choice of currency units was changed by the Company in 1793 to Dollars and Cents, to fall into line with the decimal system adopted by the United States of America. New coins from the Soho Mint had arrived in Sierra Leone by November 1793, during which month the ship on which the one cent coins were stored, the York, was destroyed by fire and the coins lost. This frustrated the move to decimal currency and the Company’s pennies and the English half-pennies that were in circulation could not be withdrawn.
Although the ensuing years were beset by troubles within the colony, many of the colonists made a concerted effort to get the colony firmly established, but there was little chance that the colony was going to become a self-sustaining entity. The most profitable exercise was trade and trade goods were continually sent from Britain in an effort to generate income for the investors of the Company.
In 1793 the wars between Britain and France commenced. The French had been in competition with British traders in Africa and now matters degenerated. Each country attacked the other’s ships and maritime trade became risky. In September 1794 seven large French ships, flying English colours, came into the harbour at Freetown and attacked the town. Led by an American slave trader who had a grudge with the colonists, the French ransacked the colony taking everything of value and destroying what they did not take. While the colony survived the attack, it was the first of many setbacks that the war between Britain and France was to visit upon the colony. Of six ships sent to the colony between 1798 and 1799 four were captured by the French and one was wrecked.
The French raiders of 1794 had taken all the silver and much of the copper coin from the colony, so the governor issued paper money for the second time, which could only be exchanged at the company store. According to Dr. Thomas Winterbottom, Physician to the Colony, following the removal of silver coin ‘it was necessary to introduce ... a paper currency of dollars, half dollars and shillings, which were received by the natives in exchange for labour, provisions etc., with the same confidence they had before taken silver’ . It is believed that none of this paper money has survived.
The issue of currency remained foremost in the attention of William Dawes, the Governor of the colony, and in a letter from the Governor and Council of Sierra Leone to the Company’s Court of Directors in London, dated 13 July 1795, the following appeal was made:
We would not recommend your sending any more Dollars while the risk of sending them here and preserving them afterwards remains so great. The wear of our paper dollars is very slow, and of course the making a number as occasion requires to keep a sufficient sum in circulation is not attended with much loss of time or other inconveniences:— but, it is far otherwise respecting shillings and sixpences. — Governor Dawes has often with extreme reluctance been absolutely obliged to give up one, two, or more days to the making of shillings and sixpences, when business of importance has rendered it very desirable that his time might have been employed in a different way. We therefore deem it extremely expedient that a number of sixpences or ten cent pieces to the value of about 40 or 50£ should be sent by the first opportunity — and these may be either silver or paper as the Court of Directors may think proper — only in the latter case two blanks for the [illegible] (one on each side) and room for two signatures at the bottom must be left, and it will require a much larger sum than above mentioned to allow for wear. (Vice, page 28.)
While Dr. Winterbottom had mentioned paper currency of ‘dollars, half dollars and shillings’, the letter to the Court of Directors by Dawes indicates that notes were being prepared in dollars, shillings and sixpences.
The use of paper money was not without its problems. As well as the wear and tear that required constant issuing of new small denomination notes, there was always the ever present problem of counterfeiting. A minute by the Council in Sierra Leone, dated 15 August 1796, records:
In consequence of there being a number of Counterfeit Dollars now in circulation in the Colony, it is hereby desired that all persons who have paper dollars in their possession, will bring them to Mr. Can’s office to get them STAMPED, as no unstamped dollars will be allowed to pass after Thursday the 18th instant.(Vice, page 30)
Had any notes of this issue survived, collectors would now be looking for the stamped varieties to match the varieties with no stamp. What exactly was stamped on the notes is not known.
A new issue of coins was struck in 1796, consisting of one and ten cent pieces. The price of silver had risen to the point that it was not economical to mint dollar coins; although the principal reason for minting coins was to replace the Company’s pence and the English half-pence that were still circulating and which had hampered the full conversion to a decimal system. It is not known when the coins reached the colony, but it can be supposed that by January 1797 the colony was fully converted to the decimal system. In describing the currency that was in circulation from that time, following the delivery of the one- and ten-cent coins, Vice states that dollar notes and twenty-cent notes were in circulation, complementing the one- and ten-cent coins and cowrie shells, which were valued at one-tenth of a cent. So it appears that, despite the importation of new coins, paper money continued to be used. David Vice speculates that paper currency was usually in use, no matter what situation existed with the coins:
During the latter years of the Company's existence they were increasingly inconvenienced by the lack of silver dollars. This forced the use of a paper currency which in all likelihood was in operation for all but two of the Company’s seventeen year rule. Only at the beginning of the Settlement and for a brief spell in 1794 (prior to the French raid on the Colony) was there sufficient silver coin available to justify the absence of this form of currency. (Vice, page 33.)
The use of the Company’s own currency was not always an advantage. European and American traders were wary of the coins and many traders passed Freetown in favour of trading communities that paid in American dollars or in slaves. The use of paper money, drawn on the Company’s store was a necessity, but it caused friction in the small colony where it was expected that any medium of exchange could be universally accepted. How many different types of paper money were in circulation is uncertain. There may only have been money issued by the Company store and there may have been other issues. Around 1800 the new Governor of the colony, Thomas Ludlam sought a statement of grievances from the elected officers of the colony. One of the grievances was ‘their paper money not being accepted at the store’.
By 1800, another significant influx to the colony had occurred. Following the expulsion of the Spanish from Jamaica by the British in 1655, many slaves took to the hills, in fear of the English. These slaves, known as ‘Maroons’, lived in the hills fighting a guerilla war for many years. Ultimately they formed their own society, lived under their own laws, and existed in relative harmony with the other inhabitants of the island. In 1795 some of the Maroons recommenced war after two of their own had been flogged by the Jamaican government. After surrendering to General Walpole, the maroons were deported to Nova Scotia, where they faced the hardships of cold and exploitation that had been faced by the former American slaves previously sent there. The Maroons petitioned a number of British politicians to have them resettled in a better climate. One of those petitioned was Thornton, who saw an opportunity to raise money and support for his colony. After agreeing to various demands, Thornton was granted his wish and in August 1800 five hundred and fifty Maroons were shipped from Nova Scotia to Sierra Leone.
For many years the matter of slavery had been debated in Great Britain. In March 1807, after a change of government, an act was passed outlawing British subjects from trading in slaves after 1 May of that year. This further limited the slave trade, although it continued to exist under the flags of other countries; especially through American ships that continued to trade in slaves while flying Spanish colours. Britain was active in suppressing the slave trade and hunted ships suspected of participating in the trade. When a ship was captured, the surviving slaves were set free in Sierra Leone—rather than being returned the slaves to their point of capture. By the end of 1811 some 1,991 slaves had been ‘set free’ in Freetown. Here they were given some support by the colonial government. These Africans came to be known as ‘re-captured’ slaves and were later revered to as ‘recaptives’.
While the colony had become home to a range of African and European settlers, the Sierra Leone Company was not a viable concern and as time passed their future looked just as bleak as had been the early years. Thornton and his company had relied on funds from the British Treasury to support the colony, funds which totalled some £67,000 by 1806, plus £20,000 to build fortifications and the costs incurred to support a volunteer corps (estimated at £3,00 per annum).
Financially, the colony was a disaster for the Company. The Governor was allowed to issue paper money for stores that did not exist and, rather than risk a general disturbance for refusing to honour the notes, the directors allowed the Governor to back the notes by bills drawn on the directors. The Treasury’s allocation to the colony in 1806 was spent entirely on reimbursing expenditure approved by the Governor.
With further losses projected, Thornton pressed the British Government to take over the colony and to relieve the Company of their burden. After much debate and public criticism, the government did take over the colony, with the appropriate legislation being passed in Parliament on 8 August 1807. Under the Act, the Company was wound up and the Crown took full possession of Sierra Leone. The formal transfer occurred in Freetown on 1 January 1808 when the Company’s flag was taken down and the Union flag hoisted.
Prior to the British Government taking over the colony, Ludlam, the last Governor employed by the Company, had been tasked to supply cash for the new administration. In a letter to Zachary Macaulay, a former Governor of Sierra Leone and now working for the Company in London, he outlined his experience and efforts to provide the cash:
Long before the arrival of the Derwent, the means of supplying the Government with Cash had been much in my mind. The paper money payable in bills had proved so convenient that scarcely any one would give more than a paper dollar for a silver one. The value of silver was much higher every where else, and consequently it never appeared in our circulation. To carry on public business, & yet to recall the paper currency, would have had precisely the same effect here as the instantaneous recall of bank-paper would have had in England. The real wealth of the Kingdom would remain the same; but without the means of readily transferring it from hand to hand in small quantities, even those who possessed it would feel the Deprivations of poverty; those who did not possess it would starve. I tried to get specie, but I could not procure enough to pay one week’s expence. The mere enquiry who had any to sell, made the silver dollar rise to Do1.20 in paper; and at this price I had not throughout the Colony the offer of Do400. How then could the public works or any business be carried on? ... In short the paper money is so interwoven with our existing policy that I could not hesitate at determining to continue it. I had the less scruple at doing this, because, had time been previously allowed, some individuals meant to have made an effort to establish a banking concern, exactly similar to what is now carried on, on the Company’s account; and, should the latter cease, the former will perhaps be ready to supply its place.
Ludlam completed his letter by suggesting that the Company could make their paper money available to the Government, charging the Crown four per cent for the right to use it; thus satisfying the request to provide cash in the colony for the new administration.
The first Governor of the new Crown Colony was Thomas Perronet Thompson, who arrived in the Colony in July 1808. Here he found a degenerate colony where young men were being publicly sold as ‘apprentices’ although they were in reality being sold as slaves by a different name. (The practice had evidently been condoned by previous governors of the Company.) Bringing numerous reforms to the colony he also addressed the issue of currency:
To stamp out in name as in deed the seditious spirit he declared polluted the Colony, he abolished the name Freetown, as inclining the inhabitants to insubordination, and substituted ‘Georgetown’. Dollars and cents, smacking of American republicanism, were replaced by sterling. (Fyfe, page 107.)
It is supposed, from this declaration by Thompson, that the notes issued by the Company, of which none have survived, were denominated in ‘dollars’. While not explicitly addressed in Fyfe’s A History of Sierra Leone, it appears that the need to trade with passing ships, alluded to earlier, meant that the American dollar (and not the Spanish dollar as previously used) had become the accepted currency within the colony under the administration of the Sierra Leone Company. As the notes of the Company were issued on bills by the Directors of the Sierra Leone Company, this was probably worded as such on the notes issued by the Company.
Although Governor Thompson complained about the over-issue of paper money by the Company, he was forced to continue the practice, due to the lack of coin. However, he circumvented Ludlam’s suggestion that the Company’s notes be used by the Government, by printing new notes. It is believed that the notes were in the pattern of the paper money previously issued by the Company, but now denominated in ‘pounds’, reworded to reflect the debt being placed on the British Treasury, and carrying Thompson’s signature. The one pound notes carried the following text:
I promise to pay the bearer on demand the sum of One Pound Sterling in Bills on the Right Honourable the Lords Commissioners of His Majesty’s Treasury. Freetown. 180_
For the Governor and Council of the Colony of Sierra Leone.
Interestingly, the notes continue to carry the name ‘Freetown‘, despite the new Governor’s efforts to rename the settlement ‘Georgetown’.
Shortly after his arrival in the colony Thompson wrote to his superiors in London seeking to have the locally produced currency replaced by quality notes based on the design of Bank of England notes. His despatch to London stated:
I have the honour to present to your Lordship that by construction of well executed bills of 5£ and 1£ each, for the paper circulation of this Colony, many advantages would arise to the Colony & to the Coast of Africa. Our present circulation is about a thousand pounds, in a paper money of which a specimen is attached to the indent of the Civil Store; the disreputable appearance of which & the ease with which it might be imitated will certainly present themselves to your Lordship. If a paper money respectably executed, in the manner of the notes of the Bank of England, was introduced into this colony, it is extremely probable that it would become in a great measure the circulating medium of the Coast of Africa; & as it could only be issued in consequence of the payments made by the government in this Colony and the Bills on the Treasury would be retained for all that was in circulation, the whole amount of the paper in circulation would in fact be saved to the British Government so long as this species of currency should be continued. The words ‘in Bills on the Right Honourable the Lords Commissioners of His Majesty’s Treasury‘, together with the visible signs expressive of the value, to which the natives of Africa refer, would probably be deemed advisable.
In the same despatch Governor Thompson also described how money was being issued by the colonial government:
The paper money is issued to answer the payments made by Government, for the whole of which payment bills are drawn on the Treasury under different heads of Public Works, Defence, et cetera & when any person brings the paper money for repayment he is paid in one or more of these Bills on the Treasury, & all the Treasury Bills that are not so called for are reserved to answer the possible demand.
In later correspondence Governor Thompson again recommended the introduction of new banknotes:
I take the Liberty to recommend a note similar in appearance to the note of the Bank of England, with the addition of the following words immediately after the sum, ‘in Bills on the Right Honourable the Lord Commissioners of his Majesty’s Treasury”, and with those visible signs of value which are inserted in the lower corner of the bills sent herewith, which are the marks by which the natives distinguish their value. The bills sent herewith [see illustrations] are the present circulation of the Colony & will show the necessity of improvement. (CO 267/25)
There is no evidence to show that Thompson’s request for a better quality note was considered or produced. It is therefore assumed that the locally produced notes continued to be used.
The use of paper money printed in the colony had created far more serious long-term problems than the immediate problems they solved. By paying for current expenses with locally printed currency, the governors of the colony had been allowed to spend unchecked. Even after the Crown took over the colony, the Governor continued to spend money on buildings and increased wages and allowances for civil servants. However, while Thompson may have encouraged the use of paper money and had great ambitions for the future of notes issued in Freetown, his successor, Captain Edward Columbine did not share the same view of paper money.
Columbine found so many notes in circulation that he ordered the Colonial Accountant not to accept any submitted for redemption. Before Thompson could leave the colony, many of the colonists collected and presented some 5,000 pounds worth of notes, trusting that sooner or later the Treasury would have to pay for them, which it did. However, before this came to pass the people had Thompson arrested for debt as he embarked the ship for his return to England, as the banknotes that were not being accepted carried his signature. As Thompson was under Crown orders to return home, Columbine allowed him to travel and he sorted out the matter of the notes once Thompson had departed. Although parliament had voted an annual grant of (on average) £16,000 to Sierra Leone, by the end of 1810 an extra £59,000 had been spent. In 1811 the vote was for £15,545 and Columbine was instructed to make the expenditure fit the budget, only spending extra money if it was sanctioned from London.
Lieutenant-Colonel Charles William Maxwell succeeded Columbine as Governor of the colony, with a brief to continue the regime of economy, with the intention of ceasing to make the colony a drain on the British taxpayer. As the colony’s paper money had been identified as a means of unauthorized spending by previous administrations ‘The paper bills were called in, dollars sent to replace them; copper coins were also sent out in 1813. But Maxwell still went on issuing local notes, which were not called in and destroyed until 1816.’ (Fyfe, page 117.)
While various attempts had been made to establish a single official currency in Sierra Leone, in areas adjacent to the colony various other mediums of exchange continued to be used. In 1820, the owners of the Banana Islands (adjacent to the colony) leased the islands to the Crown for an annual rent of 250 bars paid in Spanish dollars valued at a bar per dollar. Elsewhere, trade goods sold to local chiefs were still valued by the ‘bar’.
In 1821 the British Parliament abolished the Royal African Company, founded by charter in 1672, and the land they held in the Gambia became a dependency of Sierra Leone along with all other British possessions in West Africa between 20 degrees north and 20 degrees south. This spread the authority of the Governor of Sierra Leone from Gambia to Accra.
Many traders tried their luck in Sierra Leone, from local colonists operating on a small scale to larger enterprises sponsored from Britain. Naturally, several merchants soon came to dominate the local and overseas trade. One of the more successful traders in the 1820s was Kenneth Macaulay. Having established a sound trading business and having monopolised the local gold trade, Macaulay decided to expand his business in the area of remittances to Great Britain.
As there was no bank, money was remitted to England through the Commissariat which gave Treasury bills at par for dollars, the current medium of exchange, to pay the troops. In 1822 the Treasury sent orders that bills be publicly tendered for, and premiums accepted, as in other colonies. Macaulay organized the merchants in protest, threatening to devalue the dollar from 5s to 4s 4d to make the community not themselves, bear the cost of premiums. MacCarthy refused to allow such blackmail, and passed a bill through the Council against Macaulay’s dissenting vote, fixing the dollar officially at 5s. (Fyfe, page 142.)
In order to appease Macaulay, the government imposed extra import duties for traders who had been resident in the colony for less than two years.
As well as the official currency circulating, traders such as Macaulay issued their own promissory notes. During the 1820s a timber trader, John McCormack, issued promissory notes to his labourers that were redeemable at his store. This appears to have been acceptable to the local people who worked as labourers for him and it echoed a practice that was followed by many industrial companies in Great Britain around the 1820s. While records exist that McCormack issued his own notes, there are no recorded examples of his notes that have survived.
Although there is no record of Macaulay issuing promissory notes, it is likely that he did so. However, Macaulay’s successor certainly did issue his own notes. Charles William Maxwell Heddle was the son of an army doctor and an African woman, whose business interests are first noticed in the Gambia at Bathurst in 1834 and later in Freetown in 1840. He was a pioneer in exporting groundnuts from the Gambia and he bought the timber factories of McCormack on Kikonke Island, at the mouth of the Scarcies River, and at Gbinti, in the Melakori River. Heddle’s business expanded quite rapidly and by the mid-1840s he was sending groundnuts and timber to Freetown and he soon became the largest merchant in the colony, buying out Macaulay and Babington, two of the largest traders.
Charles Heddle appears to have retained his position as a leading trader until about 1870 and, for many years, he also held elected positions in the colony. In the Standard Catalog or World Paper Money there is an illustration of an unissued one-pound note prepared for Charles Heddle and it is identified that the note has two varieties, having been issued on green paper and white paper. How many notes, in what denominations, and for how long the notes were issued by Heddle can only be speculated.
In 1825 the use of money in the colony increased with the arrival of Sir Neil Campbell as Governor. Faced with massive corruption, much of it at the hands of Macaulay who had at various stages held official positions in the colony, Campbell set about reforming many aspects of the colony. One of the areas he addressed was the supply of rations to ‘recaptives’; i.e. Africans who had been rescued from slave ships. The rations had been supplied by contractors who were profiting by supplying sub-standard food, so Campbell commenced paying each recaptive threepence a day. The availability of money in the colony spurred local farmers to produce more crops as they now had a market into which they could sell directly, rather than the trade in food being controlled by contractors, such as Macaulay.
The currency of the colony was also addressed by Campbell and in 1825 British currency was declared legal tender, along with Spanish dollars which were already current. There was a suggestion that Sierra Leone might have their own coinage struck, but this idea was not adopted.
As the Treasury fixed a high rate of exchange between sterling and [Spanish] dollars European merchants amassed British silver to send home at a profit. Small change grew scarce, so people cut their dollars into halves or quarters, which were generally accepted. These ‘cut-moneys’ deteriorated with circulation; in time dollars cut into fifths could be passed off as quarters. The Governor and Council called them in in 1832 and had them stamped with a crown and ‘WR’ to prevent fraud. Cutting still went on, unstamped cut-moneys were still accepted, but public confidence in them failed.
In 1838 the Treasury agreed to call them in altogether, and advanced the Agents-General 9,000 to buy small British silver coins, sent out in exchange. Recaptives, whose savings were largely cut-moneys, were allowed to change them irrespective of condition, others by weight. The discarded fragments were sold in England as bullion. Dollars, revalued in 1843, went on circulating with doubloons and French francs. The British coins introduced included tiny three-halfpenny pieces, specially struck for the Colonies, but they were too easily lost to be popular and no more were sent out. (Fyfe, page 210.)
There were no banking facilities in Sierra Leone and general trade was facilitated by bills drawn on London. For example, it is recorded that a slave trader named Blanco, who had bought a captured slave ship that was being auctioned in Freetown, paid for his purchase with a bill drawn on his agents in England. Businesses in Freetown paid for imports from England by goods sent back to the exporter, or by paying in government bills bought at the Commissariat in Freetown. The Commissariat was the closest institution to a bank that the colony possessed. The Commissariat would disburse cash for bills of exchange, which it then sold to traders importing goods from England.
While the cash economy existed, tobacco and spirits were often used as currency. The tobacco and alcohol were supplied by trading ships, often sailing from Salem in America. The trading ships also supplied food-stuffs and building materials, for which they exchanged palm oil, animal hides and other local produce. As trade with American ships increased the decision was made to make American dollars legal tender in 1852. This tended to further increase trade with American vessels. 1852 had seen the arrival of Captain Arthur Kennedy as the new Governor and it was probably he who was responsible for making American dollars legal tender.
For many years the British Government had paid stipends to the local chiefs in order to keep them friendly to the Crown and to stop them fighting each other. The stipends had been paid in trade goods valued in ‘bars’. However, Kennedy reformed the process by replacing the stipends with currency, thus cutting out another piece of exploitation by the contractors who had been supplying the trade goods. The introduction of currency ‘up country’ also stimulated the economy in much the same as had the similar initiative in Freetown in the 1820s.
Postal services between Great Britain and Sierra Leone had been irregular for many years, but as the frequency of boats between the Britain and the colony increased, so too did the reliability of the postal services. In 1843 the colony appointed its first Postmaster. As trade and communication increased further, additional services were introduced and during the 1860s the English money order system was introduced into the colony. This increased the transfer of money from Sierra Leone to England and resulted in storekeepers having easier and regular access to goods in England.
The availability of cash in the colony remained an issue for many years. There was insufficient cash to cater for the variation in circulation required for the produce-buying season and this led to men establishing themselves as money-lenders, often denoting themselves as ‘bankers’. These men also provided small loans to individuals and larger loans to traders trying to establish, or support, a business. Rates varied from the favourable one to three shillings in the pound per month to the exorbitant two pounds for a one pound loan. Default on loans often led to extraordinary amounts being recouped from the defaulter. It was also not uncommon for people to borrow from a ‘banker’ at one rate and then lend the money at a higher rate.
In an effort to overcome penury due to usury, small co-operatives arose, whereby an ‘asusu’ was formed. This involved a number of individuals pooling a periodical payment, with each member of the group making use of the available pool on rotation. While this worked well in many cases, there were times when the system fell down, although the commitment to an asusu was held, in 1885, to be legally binding in a court of law. Nevertheless, the process was open to abuse, whereby an asusu could be formed and the first recipient of the pool of money might abscond with the cash and never be seen again. While this solution worked for many individuals, merchants and traders sought more reliable means of raising money.
The growing and increasingly reliable trade had encouraged further mercantile activity. In 1863 the Company of African Merchants was incorporated in Liverpool and in the following year commenced trading along the African coast. They opened a branch of their business in Freetown (and another at Bendu). These branches offered small-scale local banking facilities. At about the same time Theodore Rosenbush and his brother were offering banking facilities at their store in Water Street in Freetown. Rosenbush was responsible for issuing banknotes, although it is not know how many denominations were issued. The Standard Catalog of World Paper Money (Eighth Edition, Volume One), illustrates a ‘One Pound’ note issued by the ‘Commercial Bank of Sierra Leone’ that is signed by Rosenbush. The note is dated 12 September 1865 and numbered ‘003’. Rosenbush’s banking business remained successful for some years, being taken over by his step-son Colin in 1870 on the death of Rosenbush.
Rosenbush’s bank appears principally to have been a local business. Large remittances to Great Britain continued to be handled between trading companies and there was competition between the traders to the extent that they varied their commission for remitting money. However, as the wealth and potential of the colony grew, so too did the prospect of banking in the colony.
In 1871 John Myer Harris approached the Sierra Leone Government with the proposition of opening a bank in the colony. Harris was associated with Child, Mills and Company, an English trading company based in London and Manchester, and the proposal made by Harris and his partners was warmly received in the colony. However, their proposal was not well received by the Treasury in England, as it appears that Harris and his partners were seeking some form of official recognition as the colony’s bank. Competitors in trade cast doubts on the reputation of the partners and protested the possibility of a monopoly being imposed on the colony. A Bank Ordinance was ultimately passed, but with many checks and balances in the legislation to safeguard the public. Perhaps the criticism of Harris and his partners was well founded, as in 1872 Child, Mills and Company became bankrupt and their bank was never established.
In 1873 Bishop Cheetham opened a Penny Bank to allow the poor of the colony to secure their savings. Many people had their savings stolen and the lack of a government bank was a deficiency in the colony that had been filled by small enterprises such as those run by Rosenbush and Bishop Cheetham. As long ago as 1841, John Jeremie, the governor of the colony at that time, had proposed to establish a savings bank, but nothing had come of the plan. In 1881 Bishop Cheetham retired and left the colony and with him went his Penny Bank. Forced to fill the void, the government at last opened a savings bank in 1882. Operated by the Colonial Treasury, the bank was run by James Hastings Spaine and paid 2½ per cent interest on deposits.
Another short-term banking enterprise was launched by Dr. Horton, who had been employed by the army until his retirement in 1880. Opening a bank in Gloucester Street in Freetown, its success or otherwise is not certain; nor is it known whether this bank issued banknotes. By the time of Dr. Horton’s death in 1883 the bank was no longer operating.
At some stage Colin Rosenbush gave up his father’s banking business and went to London, where he worked in finance. During the 1880s he made several attempts to establish a bank for West Africa. He finally succeeded in raising the capital for the West African Bank Limited and returned to Freetown as its managing director. (Rosenbush had by this time adopted his mother’s name to be carried jointly with his father’s name, as Colin Rosenbush-Graham.) Established on the north-east corner of George and Oxford streets, the West African Bank survived until 1892 when it was wound up. By this time Rosenbush-Graham had fallen out with his backers in London and had moved to Liberia. It is not known whether the bank issued any notes, either under Rosenbush-Graham’s administration or under his successor’s administration.
As the trade in West Africa became more valuable, it was just a matter of time before a solid financial institution was founded. This finally occurred in 1894 when Mr. A. L. Jones founded the Bank of British West Africa. With sufficiently strong backing, the bank opened in Rosenbush’s former premises in Water Street. Although the bank was not permitted to issue banknotes, nor was it in any way backed by the government, by 1898 the government had commenced banking with it and from that point its future was assured.
Despite the apparent advance of finance and financial institutions in Freetown towards the end of the nineteenth century, various forms of currency were still in circulation.
Spanish and South American dollars still circulated in West Africa, valued at 4s 2d, worth much less: dollars carelessly remitted by the Colonial Treasurer to the Crown Agents in 1879 fetched only 3s 3d. Some were said to be made illicitly in Birmingham. In 1880 it was decided to demonetize them. Rowe , anxious to avoid any burden on the Colonial finances, proposed the community bear the loss. There was an outcry against a proposal that would have been a heavy blow to the poor, so he proposed to recoup dollar-owners from a fund raised by a House and Land Tax. Again there was an outcry. Ultimately he gave in and increased Customs duties instead. (Fyfe page 421.)
Away from the coast ‘bars’ were still being used and on an expedition to the interior in 1891 Thomas Alldridge encountered a currency known as ‘Kisi pennies’ as he passed through Kisi territory. A type of primitive money , Kisi pennies were small bars of locally smelted iron. However, the concept of modern coins was permeating the interior. In January 1892 Captain Williams, an agent of the ‘Coaling Company’, made a treaty with a local chief named Samori in which the chief sold various concessions to Williams, including the right to coin money and levy taxes. (It is understood that the concessions were not acted upon.)
From the end of the nineteenth century British sterling currency became the dominant currency in use in the colony and no further local currency is known to have been issued until Sierra Leone became independent and issued their own currency. Of the paper money issued in the colony over its existence, the following summary identifies the known issues:
This article was completed in April 2006
© Peter Symes