In 1921, the “Laryok” cooperative partnership was established for the retail sale of tobacco products. This was done on the initiative of F. E. Dzerzhinsky. At the time, he was chairman of the VTsIK Children’s Commission. “Laryok,” in fact, was created mainly to combat the growing phenomenon of children’s speculation. Tobacco products, especially in times of shortage, are a fast-moving and profitable commodity, and children are the first to understand this (pensioners are second; after them, law enforcement agencies step in).
The “Laryok” share-based cooperative issued in Kyiv several series of primitive-type payment tokens, akin to improved store vouchers, but intended for repeated use.
Street trade is fully covered by “Laryok,” which has 35 kiosks, 15 shops, and several hundred stalls in the city. In the very near future, the number of kiosks will be doubled, and the number of shops tripled. Private shops located near “Laryok” stores are being closed.
There were several reasons for the emergence of private money substitutes in Ukraine. The main factor was the lack of a sufficient amount of nationwide money in the required denominations to serve the population’s cash circulation. The main factor, but not the only one. Thus, during the Civil War, in the cities of Kyiv and Zhytomyr the system of власти changed no fewer than 11 times, and each new authority, as a rule, introduced its own currency. At the same time, the money of the previous authority was considered void and was not recognized by the new one. The population, in turn, lost trust in nationwide currency issues of all regimes.
In addition, inflationary processes continually made themselves felt. In the early 1920s, when Soviet power had already been established, inflation ran at 100% per month, and money simply lost its value.
Moreover, three systems of state money existed in the country simultaneously. Wages were paid in large sums of sovznaks. But they were not enough: goods and food cost far more. Therefore, workers’ supply schemes were organized, where essential goods and food cost only a few rubles. And the third type of money, introduced in 1922 with the start of the monetary reform, was the gold ruble, each of which equaled 50 billion sovznaks. Because of this, to avoid confusion in such a triple reckoning, hundreds of enterprises, organizations, shops, pharmacies, etc., within their areas of operation issued and used their own private money.