Banknote History

WWII Occupation and Allied Military Currency: Germany, Japan, Italy, France and the Pacific

Two families of paper money came out of the Second World War. Occupiers printed currency for the territories they held, and liberating armies printed their own to keep hard currency out of shattered economies. The diplomatic record of how the Allied notes were designed, argued over and shared with Moscow survives in the State Department's published papers, and it is far stranger than the notes themselves suggest.

Treasury policy, March 1943 AM-mark, series 1944 Plates to Moscow, April 1944 AM schillings, October 1945

Shop banknotes by country Japanese invasion money →

Last updated: September 2026

What was occupation currency in the Second World War?

Occupation currency is paper money issued for a territory by a power that controls it rather than by that territory's own government. The war produced two distinct families: currency the Axis powers issued in the lands they took, and Allied Military Currency that liberating and occupying Allied forces issued in Europe and Asia.

The two families look alike on a page and answer to completely different logics. Axis issues were instruments of extraction and control, backed by nothing the local population could call on, and they were typically produced in enormous volume. Allied issues were instruments of currency control in the narrow financial sense: a way to pay soldiers without letting dollars and pounds loose in an economy that could not absorb them. Both end up in the same collecting drawer, which is why they get conflated, and why the paperwork behind them is worth knowing.

Most of the Allied side is documented in the State Department's published diplomatic papers. What follows draws on those documents rather than on catalogue tradition, so the dates, denominations and printing arrangements below are the ones recorded at the time by the people who made the decisions.

Why did the Allies print separate money at all?

A Treasury memorandum of 30 March 1943 set the shape of the whole programme. It recommended that in the invasion stage United States armies use regular United States currency with a yellow seal and a distinguishing mark, and that the occupation stage shift as quickly as possible to a currency denominated in local units.

The reasoning is unusually frank. Regular dollars would be accepted most eagerly by local populations, and the extra cost over a special dollar note would not necessarily be great. A distinctive mark would allow the currency to be isolated if it fell into enemy hands, and would keep looted dollars already held by the enemy from flowing in. The memorandum also worried about appearances: issuing a special note with the word dollar on it that the United States did not intend to redeem at par "might seem to some people to be resorting to unethical and dishonorable practices unworthy of a great republic" (Foreign Relations of the United States, 1943, Volume I, Document 872).

The second half of the memorandum is the part collectors feel. Keeping regular United States currency in circulation alongside a local currency would create black markets whose rates beat the decreed rate, confusing soldiers and finance officers alike, and the sooner local-unit currency came in, the fewer dollars an invading army would spend. That is why the war produced marks, lire, francs, schillings and yen printed by Allied authorities rather than a wall of dollars. The yellow-seal dollars themselves are a separate and well-known collecting area, alongside the brown-seal Hawaii notes described in our guide to Hawaii overprint notes.

What was the Allied Military mark, and why did Moscow get the plates?

The Allied Military mark was the occupation currency planned for Germany. A cable of 14 January 1944 sets out the design as agreed by the Combined Civil Affairs Committee: the note would be known as the "M" mark, with a large M superimposed in the background of every denomination, in eight denominations from 1 mark to 1,000 marks.

The specification goes further than most catalogues do. Notes were to come in two sizes, the smaller at one half or three quarters the size of an American dollar bill and the larger exactly the size of one. All wording would be in German and would include "issued in Germany" and "series 1944", and it was felt expedient that the note carry some expression such as "Allied Military Authority". Serial numbers were intended on all notes, though the smallest denominations might go without them to speed the printing programme. The exchange rate against the Reichsmark had not yet been decided. The Treasury had already taken over plant facilities to produce the currency and laid in a stock of banknote paper, and the first order called for six billion M-marks, roughly 100 million pieces (FRUS, 1944, Volume III, Document 754).

For collectors that single decision is the whole story of the AM-mark. Notes printed in the United States and notes printed in the Soviet Union came from the same design and the same plate work, which is exactly why the distinction between them became a matter for numismatic study after the war rather than a matter of obvious appearance.

Why did France object to Allied Military Currency?

Because Allied Military Currency had been used in Italy, an enemy country, and the French Committee of National Liberation did not want liberated France treated the same way. René Massigli told the American representative at Algiers on 9 December 1943 that using such currency in France would be a serious mistake from a psychological point of view.

The record is candid about the awkwardness. Massigli said he appreciated the American position, that the Allies could not use currency carrying the words "French Committee" because the Committee was not a government, but hoped some form could be found that avoided the appearance of money used in occupied enemy territory. De Menthon, the Commissioner of Justice drafting plans for civil government in France, made the same point about how deeply the French public would feel it (FRUS, 1943, Volume I, Document 885).

What emerged was a compromise, and its production details are recorded. Conversations with Jean Monnet had run since December 1943; adequate supplies of French currency could not be obtained from occupied France, so a special issue of supplemental French franc currency was printed before military operations began, under the supervision of the Bureau of Engraving and Printing in the United States, to a design accepted by the Committee's representative. The rates against the pound and the dollar were selected by the French Committee itself. The Committee's representatives were not pleased that General Eisenhower would issue the currency, but they accepted it (FRUS, 1944, Volume III, Document 642).

The argument ran right to the top. On 12 June 1944, six days after the Normandy landings, President Roosevelt wrote to Churchill that if the supplemental currency proved unacceptable to the French public, General Eisenhower had full authority to use yellow seal dollars and British Military Authority notes instead, and that the Committee would bear responsibility for the consequences (FRUS, 1944, Volume III, Document 645). Those British Military Authority notes are their own collecting field.

What were Allied Military schillings?

Allied Military schillings were the occupation currency for Austria, and their purpose was constitutional as much as monetary: to separate the Austrian currency system from Germany's. A quadripartite financial committee in Vienna approved the conversion of Reichsmarks in Austria into AM schillings, scheduled to begin on 15 October 1945.

It did not run smoothly. The Soviet representative on the Allied Control Council insisted on 4 October 1945 that the conversion be postponed, and on 8 October Marshal Konev proposed converting the Reichsmarks and AM schillings then circulating directly into Austrian national schillings, arguing that with recognition of an Austrian provisional government imminent, conversion into AM schillings had lost its meaning. Washington replied that it agreed Austria should have its own national currency and did not expect AM schillings to circulate indefinitely, but that direct conversion was not possible for an extended period during which Reichsmarks would keep moving into Austria (FRUS, 1945, Volume III, Document 431).

The supply arrangements are recorded too. Vyshinsky wrote on 19 October 1945 that the Soviet Government had instructed the State Bank to accept quantities of AM schillings from the appropriate Allied authorities, and noted the British and American statement that the Soviet Government would be charged for the cost of printing and shipping the schillings transferred to it (FRUS, 1945, Volume III, Document 439). Austria's own postwar currency followed, and the parallel German reform is covered in our guide to the 1948 German currency reform.

What money did the Axis powers issue in occupied territory?

Germany issued Reichskreditkassen notes through Reich credit institutions that were set up in occupied territories and affiliated with the Reichsbank, and those issues fed directly into the postwar reckoning of occupation costs. Japan issued the family of notes collectors call Japanese invasion money across the Philippines, Malaya, Burma, the Netherlands Indies and Oceania.

The Reichskreditkassen definition above is the State Department's own, given in a footnote to the 1945 correspondence on assessing German occupation costs (FRUS, 1945, Volume III, Document 969). That context tells you what the notes were for. Occupied countries were asked to report forced payments and extensions of credit to the German State or to German agencies such as the Reichskreditkassen and the Deutsche Verrechnungskasse as a category of occupation cost, which is to say the note issue was a mechanism for transferring real resources out of occupied economies. Claims against the Reichskreditkassen were still being worked through in the reparation correspondence at the end of 1945 (FRUS, 1945, Volume III, Document 1124).

The Japanese programme is covered in depth on our Japanese invasion money page, including why Filipinos called it Mickey Mouse money and what happened to it at liberation. One thread worth adding here is Burma, because the Reserve Bank of India has documented it from the inside. Rangoon was one of the original currency circles of the Controller of Currency; Burma separated from India in 1938 but the Reserve Bank remained responsible for its note issue under the Burma Monetary Arrangements Order of 1937, and in May 1938 it issued distinctive Burma notes that were not tender in India. Japanese occupation ran from June 1942 to 1945, after which monetary matters passed to the British Military Administration of Burma, emergency money was issued to help exchange, and the Reserve Bank reopened its Rangoon office and acted as banker to the Government of Burma until 1 April 1947 (Reserve Bank of India Monetary Museum, Burma Issues).

WWII occupation and military currency, theatre by theatre

The table below sets each theatre against its issuer, its dates, its denominations, the printing arrangement behind it and what the documents record about supply. Where a source read for this page does not state a figure, the cell says so plainly rather than carrying an estimate or a number borrowed from collecting tradition.

Allied rows from the Foreign Relations of the United States volumes cited above; the Burma row from the Reserve Bank of India Monetary Museum; the Japan row from the National Printing Bureau of Japan. Values by grade are deliberately absent: no dated price-guide or auction record could be consulted for these issues while this page was written, and Planet Banknote does not publish a figure it cannot source.

What happened to money inside Japan?

Japan's own notes changed twice. The I-series and Ro-series of 1942 to 1945 dropped the printed statement of convertibility, and after the war the Bank of Japan Notes Deposit Ordinance of 1946 forced an exchange in which notes with certificate paper affixed stood in for the new money until Series A could be printed.

Six Series A denominations were issued in sequence from 1946 to 1948 under the Decree on Emergency Financial Measures, during the Allied occupation of Japan (National Printing Bureau of Japan, Showa era). One of them holds a record: the Series A 5 sen note of 1948, at 48 mm by 94 mm, is the smallest banknote Japan has ever issued. The full sequence of Japanese series before and after that reset is laid out in our history of Japanese banknotes.

Two collecting notes follow from this. The stamped and certificate-affixed 1946 notes are transitional artifacts with a very short life, which is unusual in any currency. And the Series A 100 yen carries a validity condition that catches buyers out: the National Printing Bureau states that examples missing the red mark below the central denomination text on the front, or showing red on the back, are not valid.

How do you collect WWII occupation and military currency?

Collect by theatre, by issuer or by story. A theatre set gathers every note used in one campaign; an issuer set follows one authority across its territories; a story set pairs the occupier's note with the liberator's note for the same place, which is the most interesting way to display this material.

Condition is where the money is, and it behaves differently here than in ordinary series. Notes printed in haste on wartime paper rarely survive well, so an uncirculated example of a scarce theatre issue is a genuinely different object from a circulated one. Replacement notes, printed to substitute for spoiled sheets, are the recognised premium category across military currency; our guide to star notes and replacement notes explains how to identify them. Grading vocabulary is in the banknote grading guide, and specimen notes covers the unissued examples that turn up in this field.

Three adjacent areas complete the picture. Military payment certificates are the postwar successor to this whole idea, carrying the same currency-control logic into the years after 1945. Notgeld emergency money shows what happens when local authorities, rather than armies, fill a currency gap. And Operation Bernhard is the other side of wartime currency policy: not printing money for an occupied economy, but forging an enemy's. Current stock sits in banknotes by country and, for the American issues, in United States banknotes.

Planet Banknote is a family-owned dealership in Sarasota, Florida, founded in 2021. Every note is sourced direct from mints, central banks, and authorized distributors, inspected through our Planet Banknote Verified process, and ships with a free Certificate of Authenticity. US orders ship free via USPS Priority, and every order includes a free bonus gift.