he law about the foundation of the Darlehnskassen was enacted on 4 August 1914 after a long time of preparation. The new institutions were to give out loans (Darlehen) against deposits of goods and securities. The loans were given out in form of banknote-like paper bills – the Darlehenskassenscheine.
Theses standardised certificates had a fixed rate to Gold and were accepted by all state owned institutions. This in fact gave them the necessary trust for people to use these bills like real money. Thus, although the bills were not legal tender, they circulated widely and were freely used instead of banknotes, because of their smaller denominations.
Especially the 1, 2 and 5 Mark Darlehnskassenscheine soon became very heavily used. They replaced the coins that were taken out of circulation by the Reichsbank or hoarded by institutions and people.