What Is a Military Payment Certificate?

Series 962 ten-dollar Military Payment Certificate

Heritage Auction Galleries

Military Payment Certificates, also known as MPC, were a form of money issued by the United States military to pay their personnel stationed in foreign countries. These notes were used in various areas across the globe, beginning in 1946 at the end of World War II until the last certificates were issued in 1973, just after the end of the Vietnam War. The certificates were printed using low-cost lithography presses. However, this also enabled colorful notes with beautiful vignettes to be produced.

In total, fifteen different series of MPCs were produced. However, only thirteen series were issued for use to pay military personnel. The remaining two issues that were never used were supposedly destroyed. However, some examples escaped being destroyed. Of the thirteen series that were officially issued, there are a total of ninety-four different notes to collect.

Military Payment Certificate History

At the end of World War II, local citizens in occupied territories did not trust the currency that was issued by their government. Additionally, it was unclear if the current government would survive after the military occupation. Before Military Payment Certificates were created, military personnel were paid with United States currency. Remember, checks and electronic payments didn't exist yet.

Very quickly, large amounts of United States currency began to circulate in the occupied territories. Civilians often accepted payment in U.S. dollars for less than the standard conversion rates of their local currency. This led to an increased inflation rate and negatively affected plans to stabilize local economies.

Additionally, military personnel could convert an unlimited amount of United States currency for the local foreign currency at the official conversion rate. Since there was a strong demand for United States currency, the black-market conversion rate was more favorable to the military personnel. Due to the discrepancy between the currency conversion rates, service members could profit by exchanging their dollars for local currency at the official rate and then selling them back at the black-market rate.

In an effort to stop this profiteering from servicemen and servicewomen manipulating the local currency in the black market, the United States military designed the MPC program. These paper certificates were issued in the following denominations:

  • Five cents
  • Ten cents
  • Twenty-five cents
  • Fifty cents
  • One dollar
  • Five dollars
  • Ten dollars
  • Twenty dollars (beginning in 1968 with series 661)

Remember, these certificates were not issued by the United States Department of The Treasury and therefore had no purchasing power outside of the United States military. Because they were issued by the Department of War (currently known as the Department of Defense), the military had complete control over how and when they were used.

On "payday," all military personnel in designated MPC zones were paid in Military Payment Certificates. MPCs could be used to purchase goods on the base or converted to local currencies when going on leave. However, local currencies could not be converted back to MPCs. This was done to stop the profiteering of service personnel in the black market. Additionally, MPCs could be converted to United States dollars when leaving the MPC zone. It was illegal for non-military personnel in an MPC zone to possess these certificates.

Regardless of all the rules and regulations, many local merchants and "service providers" accepted MPCs on par with United States currency. This enabled another black market to develop within the occupied territory. This practice was especially evident during the Korean and Vietnam wars.

To counteract this practice of using MPCs as a primary currency in an occupied territory and destroying the value of the local currency, the MPC styles were frequently changed to deter these black markets from developing. A conversion day or "C-day" was a military personnel's only chance to trade in their old MPC for the new issue. After the trading window closed, the old series of MPCs became worthless.

C-days were always classified and never announced to the general service personnel. When the C-day was announced, all service personnel were restricted to base. Guards were posted, and nobody could enter nor leave the base. This prevented soldiers from leaving the base and helping local
establishments trade in their MPCs for the new series. This was often done at conversion rates that resulted in pennies on the dollar for the local businesses.

For example, without the C-day date's secrecy, military service person could make a quick profit by going to the local towns and villages and offering to exchange the soon-to-be worthless MPC for the new MPC series. The service personnel would take advantage of local citizens and exchange the certificates for ten cents on the dollar. This practice would result in a quick 900% profit for the soldier and have a negative impact on trying to stabilize the local economy.

Collecting Military Payment Certificates

There are no wrong ways to collect MCPs. Some people try to collect one of each denomination issued for a particular series. Selecting a specific grade, so you have a nicely matched set, is essential. If you are going to aim for a complete set of Crisp Uncirculated notes, you might be disappointed because some notes in an individual series may not be available in any of the Crisp Uncirculated conditions. Additionally, if the notes are available, they might be outside of your available budget.

Another way to collect MPCs is to collect a particular denomination from each of the available series. This allows you, as a collector, to select the grade that will yield the best collection within your budget. For example, you could collect a ten-cent MPC from each of the series; most of them cost under ten dollars each. However, there are two notes that cost about fifty dollars each. Therefore, you could assemble a complete denomination set for about $200.

If you are an advanced collector with no budgetary constraints, you can try to assemble a complete set of certificates of every denomination from every series. The complete set would consist of ninety-four notes. It will take patience to build a collection like this because not all notes are available to purchase at any given moment.

Military Payment Certificate Values

The value of Military Payment Certificates can vary quite a bit. Depending upon the market and the availability of notes can drive the prices up or down. You should consult with a knowledgeable paper money dealer that can help you reach your collecting goals. Additionally, and most importantly, they can ensure that you pay a fair price for the notes you purchase.

Rare MPC

Some notes are valuable in any grade. You should look for the following notes if you are going to sell your collection:

Rare MPC
Series Value
471 $5, $10
472 $5
481 50 cents, $5
521 $5
541  $5, $10
591 25 cents, 50 cents
611 $5
661 50 cents, $5, $10
681 $5
692 $5