Paper money was created when someone using coins gave someone else a receipt, which had a value for trade on merchandise or noble metal (gold, silver, iron or copper), after that it was given as payment to another person to receive from its issuer. During the midle age powder gold receipts were used are circulated as money. Powder gold was easy to carry, but it was hard to assure its quality. These voucher were called silversmith receipts, because they were trusted by traders, thanks to idoneousness.

25 Sols french banknote (1792).

Bank bills
Traders were worried about the possibilitity of adultered coins, so they needed to waage and to verify the purity every time they received a coin as payment, these procedures could take long time. They began to deposit coins on banks to save time. These firstly appeared in Italy and some other countries from the 12th to the 15th centuries. They used a certificate of deposit with a statement of its money value to be given to the bearer. This conversible bill was the beginning of what we know as paper money or representative money, which had a real value in a noble metal warranty.

The famous Venetian adventurer Marco Polo took his trip to China on the 13th Century. His descriptions were also about money and he found something uncomprehensible for the European thoughts at that time, which were paper money, whithout a real metalic value or anything this like.

This kind of paper money developed inicially as emergency money and then with authorities support. In Europe it first appears 1661 by the Stockholms Banco in Sweden, because the low value coins weren't accept and there was a silver shortage.

4 Reales Paraguayan banknote (1860).

But the idea of a noble metal exchangeable paper money was widelly know until the Second World War, when many countries had their economies completely modified. Theories and economic observations of the market and gave paper money a new format and function transforming it to the representation of a country economics wealth.

10 Gulden Hungarian banknote (1848).