2nd October 1941
Guernsey switched to Reichsmarks
The Germany army made many changes to Guernsey during the second world war. The most obvious ones are still plain to see – the defences built around the coast. Others were more easily unwound at the end of the occupation. These largely revolved around bringing Guernsey life into line with Berlin.
They moved the island’s clocks ahead by an hour so they kept the same time as the mainland, switched the traffic to drive on the right, and introduced their own currency – the Occupation Reichsmark.
This was a special version of the regular Reichsmark that could only be spent in occupied territories, including the Channel Islands, France and Yugoslavia. It had no value in Germany itself.
An order of 2 July 1940, which was published in The Star the following day, set the rate of exchange at five Reichsmarks to the pound. As with all currencies, this fluctuated over time, eventually settling at 9.60 Reichsmarks to the pound. It remained at this rate until the end of the war. Following Liberation they were converted back into pounds at the same rate.
The disappearing pound
However, for much of the war, although the Reichsmark and pound technically circulated side by side in Guernsey and Jersey, the pound was rarely seen. Locals were said to be hoarding it in anticipation of the end of hostilities when, they believed, the Reichsmark would be practically worthless. This is understandable since many of them will have witnessed the extraordinary inflation that Germany suffered after World War One.
Several online sources point to an article in the 2 October 1941 edition of the Guernsey Press highlighting the lack of sterling in the system and advocating a wholesale switch to the Reichsmark on the basis that it was the only system that remained effective on the island.