Egyptian Pound

Name of Currency:  Egyptian Pound

Country / countries used:  Egypt, Gaza Strip

Symbol:  E£, EGP, LE,

Brief history:

When it comes to early civilisations Egypt is often comes to mind as one of the more advanced and this theory is backed up by its early advancements in money.

Ancient Egypt had a system fairly close to that of the early Persians who deposited their goods in church ‘grain-aries’ and used the receipts as a method of payment, but for the Egyptians  rather than using receipts they had withdrawal orders a system very similar to that of modern-day cheques . Interestingly in Alexander the great’s time, these ‘grain-aries’ or stores were often interlinked together, meaning that the cheques of the 3rd century BC could be considered more convenient than the British cheque systems of the 1980s. The giro system actually originated in Egypt it was used as a common method of money transfer in early banking.

Foreign coins started to be introduced in the fifth century BCE due to the increasing trade with Mediterranean merchants, initially these imported precious metal pieces were used by the Egyptians as a standardized weight as opposed to true money and although this seems like a big advancement the actual impact on the domestic economy was relatively small, that is until the influence of the Roman’s.

Skip forward a few thousand years and the Egyptian pound, also known as the ‘gineih’, was introduced in 1834 replacing the Egyptian ‘piastre’ as the main unit of currency although the piastre remained in circulation, valued at 1100 of a pound. Originally the piastre was subdivided into 40 ‘para’ but these were removed in 1885 and instead the piastre was divided into tenths, this year was also host to The Monetary Reform Law being issued which set gold standard as the basis for valuing the Egyptian monetary system. It was also permitted to use foreign gold coins, predominantly the Sterling pound. The British pound tended to value higher than its gold content as opposed to alternative foreign gold and became the main basis of money exchange, meaning the Egyptian monetary system was founded on the Sterling gold standard.

In 1898 the National Bank of Egypt was established and issued the first of the Egyptian banknotes in 1899, and then in 1914 a special declaration was announced that made Egyptian banknotes the ‘legal tender’ therefore ending their exchangeability into gold. In doing so the Egyptian pound banknote became the basic currency unit.