The Cashless Society Postponed: The True Value Of The Money In Your Pockets:

What do you think of the new one pound coin? Even if you like the design, your priority is probably that it should be worth the same as the old version when you do your shopping. Since it was first introduced on 28th March, however, there have been what the Guardian journalists Rebecca Smithers and Julia Kollewe have described as “a few teething problems”: Not all ticket machines at railway stations, vending machines, launderette tumble dryers and parking meters (for example) were adapted in time for the launch – and many of them around the UK still don’t accept the 12-sided £1 coin. Tescos had to temporarily unlock 100,000 of its coin-operated supermarket trolleys and when the Guardian journalists tried to use the coins in a phone booth, “they fell straight through”.

So why did the Royal Mint in Llantristant, South Wales (whose employees have been unable to use the coin in the vending machines of their local pub) produce it? According to the MBNA Banking Corporation, “over half the UK population thinks cash could be on its way out, is being replaced by contactless card payments and a third of us have days when we don’t carry any cash at all”. On June 30th, the Daily Express columnist, David Maddox, revealed that the former Chancellor of the Exchequer in the Cameron Government, George Osborne (now editor of the London Evening Standard) wanted to “scrap 1p and 2p coins and phase out cash altogether by 2020”.

The Guardian article has taken a different view, pointing out that “Despite the rise of card and contactless payments, coins remain popular: There are currently nearly 29 billion of them of all denominations circulating in the UK, with a value of more than £4 billion”. It also notes that the new £1 coin has been given a deliberately complex shape to make it harder to manufacture and counterfeit: Apparently, an estimated one in 30 of the original round pound coins are fake. Even the genuine ones – as Dan King, head of Nationwide’s current accounts department has emphasized – will cease to be legal tender on 15th October, so we should all start checking to see if we can find any down the back of our sofas. The “” website has suggested several other places you might find “lost coins”: Check all coat and trouser pockets, they advise. Also, zippered compartments in purses and shopping bags, behind furniture and in the drawers, under the bed, inside washing machines and tumble dryers, in “piggy banks” and wherever you keep your keys.

Coins can be notoriously difficult to locate, especially in poor lighting, which is perhaps why – as the Guardian reported on 21st June – the Royal Canadian Mint has unveiled “the world’s first glow-in-the-dark coin”: There are now 3 million of these, worth $2 Canadian dollars, in circulation. A luminescent UK equivalent would have been of definite advantage to the BBC TV Breakfast Show on March 27th. While one of the presenters, Dan Walker, was demonstrating to viewers what the new £1 coin looked like, he dropped it down the studio’s big red sofa and spent several minutes scrambling to retrieve it while the programme continued live.

The company which produces the £5, £10, £20 and £50 notes for the Bank Of England – De La Rue, whose headquarters are in Basingstoke, Hampshire – similarly considers that the predictions of the demise of cash “have been greatly exaggerated”. In it’s 2017 Report, it highlights the fact that 38% of the global population (1.8 billion people) don’t have bank accounts, that cash “is the world’s most socially inclusive payment method” – and that (in their opinion), it will remain so for the foreseeable future”. Furthermore (it states), “In December 2016, more cash was withdrawn from ATMs (Automated Teller Machines) in the UK than any month in history and even Sweden, probably the most cashless society in the world, has had to backtrack on its policy of removing ATMs, due to public outcry”.

The Daily Telegraph’s Industry Editor, Alan Towey, has categorised De La Rue as the world’s biggest commercial printer of banknotes: It produced 7.1 billion of them in 2016/17 and its 27% market share provides 70% of its £472 million annual revenue. As the De La Rue Chief Executive, Martin Sutherland, told Towey: “If you’re going on holiday, you will have notes we printed in your wallet, the passport you use to get out of the country was manufactured by us and when you get off the plane the currency you will use is either designed or printed by us or has some of our security features in it”. The company is coy about identifying the 140 countries for whom it designs banknotes – though Venezuela, Kuwait, Kazakhstan, Samoa, and Mauritius are reputed to feature on the list. The company has many competitors – among them Giesecke & Devrient (Munich & Leipzig, Germany) and Royal Joh Enschede (Haarlem, Holland) who both print Euro banknotes and The Royal Canadian Mint, who “make coins for countries from Indonesia to the United Arab Emirates”.

Traditionally, banknotes have been “printed on a substrate that consists of pure cotton or a mix of 75% cotton and 25% linen”. ( Now, though, there is a trend towards using polypropylene, mainly because plastic banknotes (such as the new UK £5) are more durable, they repel dirt and moisture, are twice as expensive to produce but last much longer and they can be recycled, so there’s an ecological advantage.

The main consideration, however, is undoubtedly that they are far more difficult to counterfeit. Bank of England statistics show that around 347,000 false banknotes with a “face value of £7.5 million” were taken out of circulation in the UK during 2016.

Filed under: Society | Posted on July 11th, 2017 by Colin D Gordon

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