Paper monetary system
Today our monetary system is made up of the following kinds of money:
- Banknotes
- Coins
- Money issued or created by banks (cheques, money orders, drafts…)
- Plastic money (credit card/cash card/ debit cards)
- E-money
it is based on the inconvertibility of banknotes
banknotes and coins are legal money
the other kinds:(cheques, drafts, credit cards…) are fiduciary money: we can exchange them with legal money, but we can refuse to be paid with them.
