1840: The early years
In early 1840, some parts of the Imperial Coinage Act, 1816 (UK) began to apply in New Zealand when the first Governor, Captain William Hobson, RN, extended British laws to the new colony.
This allowed for the standard British gold, silver and bronze coins to circulate freely in New Zealand alongside a variety of foreign coins.
In short supply
Coins, especially copper coins, were very hard to get in the 1840s and 1850s. Instead, traders tried issuing low-value paper notes but soon gave up this approach.
Eventually, in 1857, a group of Auckland and Dunedin businesses decided to issue their own penny and halfpenny copper tokens. In total, 48 traders (mostly retailers) issued coins and continued to do so until 1881. Use of these coins gradually declined during the 1880s.
In 1897, New Zealand's coins became subject to some parts of the Imperial Coinage Act 1870 (UK). This meant only British coin was the official legal tender in the colony. At the time, British coin was one of two ‘common' currencies, the other being Australian-minted gold sovereign and half sovereign coins.
From 1914, gold coins gradually started to be withdrawn from circulation. Then in 1920, silver coin was debased from .925 fine (sterling silver) to .500 fine.
1933: We get our own currency
By 1933, it was obvious something needed to be done about coin smuggling and the shortage of lower-value coins. It was decided the country should start issuing banknotes and coins from a single bank, while the New Zealand Numismatic Society suggested adopting a decimal system of coinage.
Instead, in 1933, a unique New Zealand coinage was introduced by the Coinage Act 1933, with British coin no longer legal tender from 1 February 1935.
About the new coinage
Based on a fractional system, the new coins used the same weights, sizes and denominations as the British coins. Bronze coins (penny and halfpenny) of British standard were not approved until six years later on 22 December 1939. These were issued in 1940 at the same time as the New Zealand Centennial.
In 1947, cupronickel coins replaced .500 fine silver coins due to the rising costs of mining and the price of silver. Both metal types of coins were still considered legal tender.
1967: The change to decimal currency
In 1967, New Zealand changed to decimal currency. A great deal of work was needed to make the change from imperial currency, including a large publicity campaign. A series of TV ads were used to introduce the concepts to New Zealand viewers.
Watch this short video about the introduction of decimal currency to New Zealand
Background music plays
Audio: Oh hello, I'm just practicing my notes ready for July 10 this year when a ten-shilling note becomes a dollar note and a pound note becomes $2 and there will be 100 cents to the dollar. These are the new coins: 1 cent, 2 cents, 5 cents, 10 cents, 20 and 50 cents. You'll be using these from the tenth of July this year.
About the new decimal coins
In 1964, the Decimal Currency Act 1964 set out the designs, diameters and standard weights of the decimal coins, which first appeared in circulation on 10 July 1967. The coins introduced were the 1 cent, 2 cent, 5 cent, 10 cent, 20 cent and 50 cent coins.
The coins were all designed by Reginald George James Berry (known as James) of Wellington. His initials (JB) appear on the reverse of all of these earlier bronze and cupronickel coins.
The word 'shilling' was included on the 10 cent coin to help with the change to decimal currency. It featured on minting of the 10 cent coin for the years 1967, 1968 and 1969 and was dropped in 1970. The 1968 10 cent coin minting were for collectors' sets only.
Watch this video about how $120m of the new decimal currency, weighing 730 tonnes, was sent to nearly 600 bank branches around the country by plane, ferry, truck and train between April and June 1967. ‘Operation Overlander’ went without a hitch with not one cent lost.
Background music plays
Audio: A secret so well-kept that everybody knew about it. Wellington, 3 months before the tenth of July (DC Day).
The Reserve Bank vaults open and millions of dollars and cents begin their journey to 592 banks all over New Zealand.
For a year the decimal currency board has planned this manoeuvre which will probably never happen again in the country's history.
The operation, controlled by 7 men, carried out by thousands.
Sacks and ammunition cases loaded with raw new coin and bright pieces of paper for people to spend soon in Whangaroa, Whangarei, Whanganui, Nelson, Napier and Nightcaps.
6 special trains to be loaded, locked, sealed and checked.
Audio: Transport is made all over the country by road, rail, sea and air. Strait ferries to the South Island and trucks where there is neither railroad nor airline.
Bank officers travel with all transport checking constantly. Police escort too keeping radio contact all the time.
Check between carriages and car. Between car and the nearest police station.
Audio: 1,788 miles by train to 384 bank branches. At every stop the army handles the cash.
Police, 2 to a wagon and dogs, 2 to a train stand guard.
Audio: 27 million notes: weight 30 tonnes, value 12 million dollars.
165 million coins: weight 700 tonnes, value 8 million dollars.
120 million dollars to transport to every bank in the country and not one cent goes missing.
July tenth and delivery is completed. And now the business of 2 and a half million New Zealanders getting used to a new currency begins.
Coins disappear and new coins appear
On 31 March 1989, the issue of 1 and 2 cent coins stopped and both were demonetised on 30 April 1990. Being demonetised means the coins were no longer legal tender.
In December 1990, a new 20 cent coin was introduced to replace the old 20 cent coin, as the Kiwi design on the old coin was transferred to the new $1 coin. Both designs of the 20 cent coin were legal tender along with the earlier 2 shilling piece or florin.
On 11 February 1991, new $1 and $2 coins were introduced to replace the $1 and $2 notes. These two coins and the new 20 cent coin were all designed by Robert Maurice Conly, MBE, of Wellington.
2006: We introduce today's coins
On 31 July 2006, we introduced new smaller and lighter 10, 20 and 50 cent coins made of plated steel.
At the same time, we began withdrawing the corresponding old, silver-coloured cupronickel coins and the 5 cent coin (which was not replaced). Over the years inflation had reduced the value of the 5 cent coin so much that it became a nuisance and of no real value to people making transactions. The old coins were demonetised from 1 November 2006.
In 2006, we ran a public awareness campaign about the new coins that included a website, www.newcoins.govt.nz. This website was archived in 2012.
Where coins are minted
New Zealand’s $1 and $2 coins are minted by the Royal Mint in the United Kingdom. The 10 cent, 20 cent and 50 cent coins are minted by the Royal Canadian Mint.
Other mints we have used over time include the Royal Australian Mint, Norwegian Mint and the South African Mint Company.