The Secret History of the Tally Stick

Money as Debt

Keeping a tally or record is different from making a payment. But in some languages the tal- root was transferred to split tallies, which served as money. Today, a surviving cluster of words for “to pay” and “payment” indicate their association with the use of physical money-tallies, while these objects have since disappeared and are forgotten. Northern France had much Viking contact, including their invasion of what became Normandy. Northern parts of Germany traded with the Vikings, who moved inland via the Elbe, Rhine, Weser and other rivers. The Germans today use beszalen for “to pay” and Zahlung for “payment.” The earliest written evidence of these zal forms is in Old High German texts from the tenth century. The Danes speak of betale and betaling respectively. The Dutch use betalen and betaling. For the Norwegians it is betale and betaling. The Swedes use betala and betalning. Britain and Ireland traded with the Vikings too. Hence the Welsh use talu (pronounced tali) and taliad for “to pay” and “payment.” Cornish has talas for “payment.” In other Celtic languages, these tal- words are absent. They may have existed previously but disappeared. Modern English preserves the word tally for reckoning, but not for a payment. But in the other Northern European languages listed here, the tal- root is associated with paying and payments. It is likely that these are all linguistic survivals of Viking trade, over a large part of Northern Europe.

All this is illustrated by the split tally. The sides of a twig of seasoned hazelwood or willow were shaved to create a square section along its length. Some tallies were as short as five inches. Later, partly due to inflation, some became much longer. Just as it had been done for tens of thousands of years before, notches were cut crosswise into one side of the stick, and sometimes into the opposite side as well. These notches could represent goods or amounts of money. Cuts and notches, of different widths, recorded amounts of money according to established conventions. The amounts in the agreement would also be recorded on the side of the tally in ink. 

It was then split along most of its length, dividing the notched side and its obverse into two separate pieces. One section at the end of the tally (without notches, for about an inch or more) remained intact. The result was two pieces of wood, one longer than the other, but both carrying the same notched records. There were helpful irregularities in the wood grain and its carving. The two pieces could be brought back together to verify the record of the agreed transaction. The irregularities helped to show that the two parts were authentically related. Fraud was difficult or impossible. Money is a duality – a debt and a credit, based on a relational agreement sanctioned by law. The tally stick was split to represent this.(4) 

As shown below, a curved notch, about the width of a thumb, represented £100. To the right of this in the picture, a ”V” is incised. This represents £20. To the right of that, with “the width of a ripe barleycorn” is a notch representing £1. Two further notches to the right, of diminishing widths, represent 1 shilling and 1 penny respectively. The total value of the tally in the picture is £121 plus 1 shilling and 1 penny. 

The shorter part was called the foil or stub, the longer part was called the stock. The foil indicated an obligation to pay the stockholder. In accounting terms, it was a liability. The stock was the IOU given to the creditor. It had positive value – an asset for its legal owner. The legal contract that was recorded on the tally, followed by it being split, created a positive monetary value and a numerically equal negative amount, on two pieces of wood of negligible intrinsic worth.(5)

The money was not created out of physical stuff, but out of the legal and customary social arrangements that allowed the creation of debt and an expectation of its recovery. The stock could be sold to a third party, typically at a discount. The discount partly reflected the cost and difficulty of finding the debtor and enforcing payment. The tally stock is the etymological origin of financial stocks. 

The widespread use of the tally stick as money depended on the previous evolution of money as a legally enforced unit of account. Tally sticks did not originate money. But they played a crucial and continuous role in the development of medieval and modern monetary systems until the nineteenth century. Much commerce in medieval times was carried out using tallies. One of the functions of medieval fairs was to bring tally users together to reconcile their credits and debts. Lawyers were available to verify the tallies and deal with disputes. 

In England, from about 1100, Henry I used tallies for public finances, including in the collection of taxes. Henry required that the transactions, the transactors, and the amounts involved be written in ink on both parts of all tallies. Legal recognition and state use led to a widespread use of tallies, including for state finances. By the 1437-47 decade, 64 per cent of tax receipts were “tallies of assignment.” As Mitchell Innes noted: “Practically the entire business of the English Exchequer consisted in the issuing and receiving of tallies.” Tallies were also used as devices to circumvent the usury laws, often by fictitiously increasing its notched record of an original loan. 

After Charles II came to the throne in 1660, he further expanded the use of tallies to increase public borrowing. His Treasury officials created the “tally of loan.” Such tallies were backed up by a repayment order with six per cent interest. Samuel Pepys in his diaries referred several times to payments at the Exchequer made by tallies. After the founding of the Bank of England in 1694, the Bank Act of 1697 increased its authorized capital, allowing up to 80 per cent to be paid in tallies, and the rest in banknotes. But, almost a century later, an Act of Parliament of 1782 declared that the Exchequer’s use of tally sticks would be phased out. Tallies continued to be cut until 1826. In 1834 the Exchequer gathered many thousands of tallies in cartloads. These were stuffed in bundles into a stove and burnt in the House of Lords, thus destroying seven centuries of invaluable public financial records. The fire spread out of control and destroyed both Houses of Parliament. In its fiery death, tally money had its symbolic revenge. These unfortunate tallies had already been deprived of their monetary value. Their material form was the means of their retaliation. Its combustion destroyed the building that had helped to give them meaning, authority, and power.(6)