Postage Currency

 During the early years of the Civil War, in response to the political uncertainty of the time, the banking industry suspended the redemption of paper money for coin. The net effect of this action was to place a premium on coins vis-à-vis paper money and there resulted a widespread hoarding of coin by the public. Coins of all denominations were jealously guarded and hoarded and soon had all but disappeared from circulation. This was partly alleviated by small denomination (less than $1) U.S. postage stamps. People would encase the stamps and use them for trade.

  The solution, generally credited to Francis Spinner, Treasurer of the United States during the Lincoln administration, was the issuance of a form of fractional notes similar in appearance to the postage stamps they were designed to replace in circulation.
 
In all there were five different issues, or major design types, printed from 1862 until 1876, when production of these notes ceased. The designs were changed with some frequency in response to an alarming rate of counterfeiting.