The month after next will see the introduction of the Bank of England’s brand new £5 note in the UK. This new ‘plastic’ banknote, made from a polymer substrate boasts a smaller size, new texture and refreshed design – plus some innovative new security features. But, for UK businesses the new note comes with a hefty price tag. Companies across the UK are already reporting that will be a significant cost of compliance – as they prepare to re-calibrate everything from ATMs to vending machines – in order to accommodate the new notes…
The new £5 note will enter circulation on September 13th. It will circulate alongside the existing note for a number of months as the old note is gradually withdrawn.
Alongside a refreshed design, the new £5 note boasts a number of enhanced security features – making it harder for forgers to counterfeit the note – and easier for businesses and consumers to spot those notes that aren’t genuine. These include:
But it’s not just an update to the security features which has prompted the Bank of England’s move to polymer. The plastic notes are stronger than their cotton predecessors, are less likely to rip or tear, and are expected to stay much cleaner.
According to the Bank of England, “each new polymer note is expected to last at least 2.5 times longer than the current paper notes.” This longer lifespan means that fewer notes will need to be produced – a sound financial move for the Bank of England who report that polymer banknotes will ultimately reduce production costs by around £100m.
For businesses though, the introduction of the new notes has already proved challenging. ATMs, vending machines, self-service tills, parking meters and cash counters will likely need to be re-calibrated, or even replaced, to ensure that they’re ready to process the new £5 note. Brendan Doyle, Chief Executive of CMS Payment Intelligence suggests that these updates won’t come cheap – costing UK businesses around £236m.
Plus, with reports that the new polymer banknotes are prone to sticking together (even if only initially), businesses are already preparing for the possibility that they may see an increase in counting and processing errors.
Despite the anticipated challenges, polymer banknotes have already been greatly received by the public all over the UK. In Scotland, Clydesdale Bank released a limited number of Polymer £5 notes back in March 2015. Two million of these commemorative notes made their way into circulation early last year, with minimal disruption, although it is reported that the majority of these were quickly snapped up by collectors.
In England and Wales, owners of vending machines, ticket machines, friction counters, cash-counters, self-services tills or other related devices are advised to reach out to their suppliers ahead of time, to find out how or if their hardware will be affected.
For Tellermate customers, in most cases, even older cash-counters can be equipped to process the new £5 note with a simple software update. Customers are advised to contact customer services here to talk through the options for upgrading their current device.