Many moons ago, cookware and dishes in Europe were made of an orange
clay called "pygg." When people started saving coins in jars made of
this clay, they jars became known as "pygg banks."

In the nineteenth century, allegedly an English potter misunderstood the
meaning of the term "pygg,' thinking it was "pig." When someone asked
him to make a pygg bank, he made one shaped like a pig. This idea
caught on and soon everyone wanted a "piggy" bank.