WHY DID MERCHANT SCRIP EXIST?

 
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Before banks were established in remote regions of Canada, paying employees involved shipping currency long distances into wild and often lawless regions. The alternative to this risky enterprise was for the company to issue its own money. Called scrip, this private merchant currency was redeemable for products at the company store and even frequently in the local economy.

 
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Following the collapse of the 1837 Rebellion in Upper Canada, its leader, William Lyon Mackenzie, fled with some of his supporters to New York State. He then set up a "provisional government" on Navy Island, a small island in the Niagara River. Mackenzie issued scrip when all other means of acquiring supplies failed. The notes were allegedly payable four months after date at City Hall, Toronto, and were based on nothing more substantial than the dream of a successful invasion of Upper Canada.

In a desperate bid to make his scrip more appealing to the business community of Buffalo, Mackenzie had the signature of David Gibson forged on the notes. Gibson, a prominent and wealthy man, had been one of Mackenzie's supporters, but at the time the scrip bearing his name was issued, he was a hunted fugitive with a £500 bounty on his head. The forgery was in vain, for the notes never circulated to a significant extent. In fact, the scrip was ridiculed on both sides of the border.

To read the complete article, see page 83:
https://www.torontocoinexpo.ca/documents/
GB%20Auctions%20T.O.%20Coin%20Expo%20May%202025.pdf

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