During the Edo period, feudal domains of Japan issued scrip called hansatsu (藩札) for use within the domain. This paper currency supplemented the coinage of the Tokugawa shogunate. Most scrip carried a face value in silver coinage, but gold and copper scrip also circulated. In addition, some scrip was marked for exchange in kind for a commodity such as rice. In addition to those issued by the domains, forms of paper money were also issued by rice brokers in Osaka and Edo. Originally used only as a representation of amounts of rice (subdivisions of koku) owned by the scrip-holder and held in the Osaka or Edo merchants' storehouse, these scrips quickly came to be used as currency.
Japan's first banknotes, called Yamada Hagaki (山田羽書), were issued around 1600 by Shinto priests also working as merchants in the Ise-Yamada (modern Mie Prefecture), in exchange for silver. This was earlier than the first goldsmith banker notes issued in England around 1640.
