The earliest evidence of using paper money is related to the Chinese and paper money became quite common in around AD 960. There were initially two forms of paper money, receipt and debt notes. In early times in Europe, the merchants also served as bankers and they issued receipts in return for deposits. Merchants who had contacts in other countries issued notes in return of deposits that carried a certain value. Then the bearer of this note was allowed to make a transaction using the note at a merchant who would accept the note. It was in 1661 that the bank of Stockholm issued the first bank notes. After that the system of currency developed.
