Although Christopher Columbus sighted the coast of Nicaragua in 1502, Gonzales Davila and his fellow conquistadores were the first Spaniards to step foot on Nicaragua in 1522. The provinces of Leon and Granada were part of the Vice-Royalty of New Spain before becoming part of the Central American Republic in April 1823. On April 17, 1825, the two provinces were merged to create Nicaragua. Nicaragua remained a constituent state of the Central American Republic until April 30, 1838 when it declared its independence. The eastern coast of Nicaragua was a British protectorate affectionately called the 'Mosquito Kingdom', but in 1850 the coast was ceded to Nicaragua while confirming British possession of British Honduras.
Spanish Escudo (XESE) coins were used in Nicaragua while it was part of the Vice-Royalty of New Spain with 1 Escudo divisible into 2 Pesos or 16 Reales. The Central American Escudo/Peso (XCAE) was used while Nicaragua was part of the Central American Federation. After gaining its independence, Nicaragua issued the silver Peso (NIP), at par with the Central American Peso, and divisible into 8 Reales. Nicaragua linked the Peso to the French Franc in 1870 with 1 Peso equal to 5 French Francs and divisible into 100 Centavos.
Nicaragua has never minted its own coins domestically. All coins have been minted in the US or the UK. Nicaragua's first coins were issued in 1878. In the early 1900s, Nicaragua was split into two currency areas, with gold and silver being used on the Atlantic side, in Cabo and Zelaya, while paper money predominated in the west.
Nicaragua unified its currency by introducing the Gold Cordoba (NIG) on March 20, 1912 with 1 Gold Cordoba equal to 12.5 Pesos. Nicaragua left the Gold Standard on November 13, 1931. Nicaragua suffered severe inflation under the Sandinistas. The Nicaragua New Cordoba (Chanchero) replaced the Gold Cordoba on February 15, 1988 at the rate of 1 Cordoba equal to 1000 Gold Cordobas. The Cordoba Oro replaced by the Cordoba on April 30, 1991 at the rate of 1 Cordoba Oro equal to 5,000,000 Cordobas.
The Government of Nicaragua issued banknotes until March 20, 1912 when the Banco Nacional de Nicaragua was established and the Cordoba was introduced. The Banco Central de Nicaragua replaced the Banco Nacional in 1961 as the sole note issuing authority. |
