The pros and cons of paper currency

Paper currencies are the most widely used medium of transaction today. They are the replacement of metal coins which were popular at one time. While paper currencies have their own advantages, there are certain disadvantages as well. In this post, you are going to find out the advantages and disadvantages of paper currency.

Advantages of paper currency


The cost incurred in the production of paper currency is comparatively lesser than that of metal coins. This makes it convenient to produce more currency notes without having to worry about the expenses.


Metallic coins are not the best things to carry around. Paper currencies, on the other hand, are light and you can easily carry them with you at all places. The strongest currencies in the world will tend to have bank notes of smaller demonitaions because they have greater purchasing power. 

Can be easily stored

Paper currencies need less space to be stored. You can store a large amount of money very easily in a small vault.


Disadvantages of paper currency


With currency notes, there is always a risk of oversupply. This can cause inflation in the country which is not good news at all. 


Compared to metallic coins, paper currency notes are not as durable. This means that you can’t use a currency not for a longer time.


Paper currencies are not very stable. This means that they are liable to changes as the authorities decide to do so.


Paper currency notes can be demonetized at any point in time. Once demonetized, they don’t hold their value.

These were some of the advantages and disadvantages of paper currency. For more information on currencies, keep visiting this site. Here, you’ll find all the information about the highest currencies in the world.

Hope you found something valuable from this post. Share your thoughts with us in the comment section.

Add a Comment

Your email address will not be published. Required fields are marked *