Representative credit and fiat money all provide solutions to several limitations of commodity money. Depending on the laws there may be little or no need to physically transport the money — an electronic exchange may be sufficient. Other types of moneys have as their sole use to be medium of exchange so their supply is not limited by competing alternate uses. Credit and fiat monies can be created without limit in theory so there is no limit on trade volumes.

Fiat money if physically represented in the form of currency paper or coins can be easily damaged or destroyed. However here fiat money has an advantage over representative or commodity money in that the same laws that created the money can also define rules for its replacement in case of damage or destruction. For example the U.S. government will replace mutilated federal reserve notes U.S. fiat money if at least half of the physical note can be reconstructed or if it can be otherwise proven to have been destroyed.. By contrast commodity money which has been destroyed or lost is gone.

Paper currency is especially vulnerable to everyday hazards from fire water termites and simple wear and tear. Currency in the form of minted coins is more durable but a significant portion is simply lost in everyday use. In order to reduce replacement costs many countries are converting to plastic currency. For example Mexico has changed its twenty and fifty peso notes Singapore itsand  bills Malaysia with RM bill and Australia and New Zealand their andto plastic both for the increased durability and because plastic may be easily specifically constructed for each denomination thus making it impossible for counterfeiters tolift" or raise the value of a bill by using the material of a bill of lesser value as a primary source to make a counterfeit note of higher value.

Some of the benefits of fiat money can be a doubleedged sword. For example if the amount of money in active circulation outstrips the available goods and services for sale the effect can be inflationary. This can easily happen if governments print money without attention to the level of economic activity or if successful counterfeiters flourish.

A criticism of credit and fiat moneys relates to the fact that their stabilities are highly dependent on the stability of the legal system backing the currency should the legal system fail so will the value of any type of money that depends on it. However this situation is typical of the maintenance of the value of any promisory note system if a guarantor creates money or wealth by means of any legal promise to provide goods or services in the future as is the case with both credit and fiat type moneys then any failure of a legal system which backs up the rights of the debtholder to collect on the promise will act to jeopardize the value of future promises.