The colón was the currency of El Salvador from 1892 until 2001, when it was replaced by the U.S. dollar during the presidency of Francisco Flores.

Nonetheless, the commonly available cent symbol '¢' is frequently used locally to designate the colón in price markings and advertisements.

On October 1, 1892, the government of President Carlos Ezeta, decided that the Salvadoran peso should be called the 'Colon', in homage to the discoverer of America.

At the end of the 19th century, new paper money began to play an important role as an instrument of change as a unit of measure of the value of goods and as an element of savings.

On October 1 of that year as a tribute to Christopher Columbus in the Discovery of America, the legislature reformed the monetary law and changed the name to "Colón".

The main problem was the lack of a specialized institution dedicated to ensuring that currency retained its value by controlling banking activity.

In response, the government of General Maximiliano Hernández Martínez hired an Englishman named Frederick Francis Joseph Powell to analyze and structure the Salvadoran banking body.

Thus through the presidential initiative on June 19, 1934, the legislature approved the creation of the Central Bank of El Salvador, an institution whose objectives are set to control the volume of credit and demand of currency, and was also conferred the exclusive power to issue monetary kind.

From 1961 to 2001, the Superintendency of the Central Reserve Bank (Spanish: Superintendencia de Bancos y otras Instituciones Financieras) was responsible for the validation of Salvadoran banknotes.