FishStick, I think you might have a rare item. I've searched and looked at 100's of pics of compasses, and I've yet to see one with raised letters. I even thought it might be for the visually impaired, but the Braille ones have dots, not letters; besides, it's too little for a hands-on compass.
The only compasses with raised letters I could find were on modern jewelry like key chains and pendants, and yours is definitely vintage. Of course, just because I can't find a pic or any information on antique compasses with raised letters doesn't mean there's not some out there.
Since history repeats itself, and yours is a tiny compass, I'm wondering if it is an antique
pendant and was attached by the 2 holes on the side? I've seen several Victorian compass necklaces/pendants, but none with the text in relief.

Breezie