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Paper money was introduced in Song Dynasty China during the 11th century. The development of the banknote began in the seventh century, with local issues of paper currency.
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The first use of paper currency can be traced back to the year 806 AD in China where they were used as "flying currency" because of the usage of letters of credit transferred over large distances. Before that, the Chinese used leather notes made of one foot square pieces of white deerskin with colorful borders for money. The Song dynasty was the first to issue real paper money in 1023 and the most famous Chinese issuer was Kublai Khan, a Mongol leader, in the 13th century. 

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