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The National Banking Act of 1863 laid the groundwork for the creation of a national banking system. It also led to the establishment of a national currency backed by government securities held by other banks and gave the federal government the ability to sell war bonds and securities.

To promote opportunity, a dynamic economy, and a stronger Union, Lincoln and Chase conceived the national banking system and the Office of the Comptroller of the Currency to regulate and supervise it.

The National Bank Act of 1863 was designed to create a national banking system, float federal war loans, and establish a national currency. Congress passed the act to help resolve the financial crisis that emerged during the early days of the American Civil War (18611865).

Federalists, like Alexander Hamilton, believed that a strong, central bank was essential for the new nation. A strong, central bank could prevent abuses in banking. Anti-federalists, like Patrick Henry, believed that a strong, central bank would have too much power.

A national currency is a legal tender issued by a country's central bank or monetary authority and the mode of exchange for purchasing goods and services. In the United States, the dollar is the primary form of currency and is controlled by the Federal Reserve.

The National Bank Act of 1863 was designed to create a national banking system, float federal war loans, and establish a national currency. Congress passed the act to help resolve the financial crisis that emerged during the early days of the American Civil War.

To meet the government's financial needs during the Civil War, President Lincoln and Treasury Secretary Salmon P. Chase borrowed from foreign governments and American citizens, instituted the country's first general income tax, and printed paper moneyso-called "Greenbacks."