Bank of England Banknote Checking Scheme

With the launch of the new £5, £10 and £20 note, it’s more important than ever to stay vigilant when it comes to counterfeit notes. We have joined the Bank of England Banknote Checking Scheme. This will provide us with news and updates about banknotes and initiative to tackle counterfeit currency.

Here are just some of their recent findings :

Interestingly they have seen an increase in use of electronic payments, it is clear that cash remains an important means of payment for many people. The findings of the Access to Cash Review (2019) highlighted that cash is the dominant payment preference for over 2 million people, and for many others it is part of a number of payment options they use for transactions. More disadvantaged socio economic groups, those aged 65 and over and those in rural communities are more likely to use cash. It is particularly important for those without access to banking, while others use it as a budgeting tool. We have been asked about the presence of viruses and bacteria on banknotes. Like any other surface that large numbers of people come into contact with, notes can carry bacteria or viruses. However, the risk posed by handling a banknote is no greater than touching any other common surface, such as handrails, doorknobs or credit cards.
In this issue Banknote Checking Banknote Checking: Polymer £10 notes Polymer £5 damaged notes “Composite” counterfeit notes The new polymer £50 note – arriving in 2021 Other banknote updates.

Their published data for 2019 shows a drop in counterfeit banknotes overall with 427,000 counterfeit Bank of England banknotes, with a nominal face value of about £10 million, taken out of circulation. That’s down from 473,000 in 2018, which means 46,000 fewer counterfeit banknotes causing losses for businesses and affecting communities. This decline continued into the early part of this year and dropped significantly between March and July 2020 following the introduction of Covid-19 restrictions. Whilst we have seen some increase since then, counterfeit levels still remain significantly down on 2019 volumes. The level of counterfeit banknotes over the years is shown in the chart below, and there’s further information on their website. The paper £20 and paper £50 notes are the focus of counterfeiters and continue to be so. The impact of the polymer £10 is shown by the reduction seen from 2018 following the previous paper note’s withdrawal in March of that year. £5 notes are not targeted by counterfeiters but have also dropped significantly since the previous paper design was withdrawn.

They hope to see this improvement replicated for the £20 note, and £50 in due course. Since the start of this year there have been some attempts to forge the polymer £10 note using a plastic material (different to that of the genuine note) and we wanted to let you know that counterfeiters are trying to pass these in shops and businesses. Importantly, these fake polymer £10 notes can easily be identified by the security features highlighted in training materials. In particular, you should always check the Hologram image change. Below the see-through window on the front of the note, there is a silver foil patch containing a hologram. Tilt the note from side to side. Check the words change between ‘Ten’ and ‘Pounds’. The same security feature is in place for all polymer notes, with the word ‘Ten’ replaced by the denomination in question. Polymer £5 damaged notes There have been a number of incorrect reports on social media or in newspapers claiming that there are counterfeit polymer £5 notes in circulation which can be detected by scratching at them with a coin. In practice, like many types of printed plastic, if someone scratches polymer notes with a sharp object the print can sometimes be removed. All current counterfeits can be identified using the security features highlighted in training materials. There is no additional benefit in scratching the note. If you do receive £5 notes that someone else has damaged previously, please take them to your own bank or post office. If they are not accepted, the Bank of England will reimburse you with the face value of a damaged banknote if you still have at least half of the banknote. Details on how to apply for a reimbursement are provided on the Bank’s website: www.bankofengland.co.uk/banknotes/damaged-and-contaminated-banknotes. Your own bank or post office may do this on your behalf, and issue a receipt. There’s a full range of information, advice and free educational materials about all banknotes on the Bank’s website. The equivalent guidance on Scottish and Northern Irish notes can be found on the Association of Commercial Banknote Issuers’ website. “Composite” counterfeit notes.

The police have identified that counterfeiters are attempting to target some models of gaming machines and other cash acceptors using counterfeit Bank of England paper design £20 banknotes featuring Adam Smith on the back. The counterfeits are unusual in that most of the note is genuine with only the section containing the watermark panel being counterfeit, with the two parts taped together. Manufacturers are aware of the new threat and are taking steps to update their software accordingly. Business owners are advised to check with their supplier and install the latest software as soon as possible. The criminals may then also join together the remaining part of the genuine and counterfeit notes and attempt to pass this second composite counterfeit via a manual payment. Both types of composite notes can be easily identified as they are crudely cut and joined by tape between the watermark panel and the foil strip on the front, and each section will bear a different serial number (on the back). As a general rule, we advise that if a note has been joined with tape and the serial numbers on both parts are different these should be reported as counterfeit notes to local police. The new polymer £50 note – arriving in 2021 The Bank and the cash industry are working together to prepare for the arrival of the new polymer £50 note, which will enter circulation in mid-2021 and feature the mathematician Alan Turing. Like all polymer notes, the £50 will be more resilient against counterfeiting. Furthermore, the public security features of the banknote will be essentially the same as the other polymer notes in the series, meaning both businesses and the public can be more confident in checking them. The note is also smaller so will be easier to carry and can be accepted by machines that can’t cope with the paper £50.
Other banknote updates. As you’ll be aware, the new polymer £20 note was successfully launched on 20 February 2020. The new notes rapidly made their way into circulation and by the end of October made up more than 60% of £20s in circulation. Paper £20 notes can continue to be used as normal, so we need to check both paper and polymer £20s. The Bank will give 6 months’ notice ahead of legal tender status being withdrawn for the paper £20 note.
You can contact them if you have any comments or questions at: banknotecheckingscheme@bankofengland.co.uk

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Charlene Gentile

About the Author Charlene Gentile
Charlene is our Digital Marketing Specialist. With a wealth of marketing experience, she is using her expertise to help to communicate the variety of services we have here at Hanley Economic Building Society.

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