After introduction of new £5 and £1, businesses have to be ready for phasing out old currency or face confused consumers
In the wake of the successful introduction of the new £5 note in 2016, businesses now face the most complex part of the biggest upheaval of UK currency in decades, says Cummins Allison, the leading innovator and provider of coin and currency processing solutions. While the new one pound coin is expected to be introduced smoothly this month, the greater challenge to organisations and consumers alike will be the withdrawal of the old, paper five pound notes on May 5th and of the old pound coins on October 15th. While part of a dramatic strategy for improving the UK’s counterfeit resilience, the withdrawal has significant potential to confuse consumers, who may be left with large amounts of out-of-date currency if they aren’t given the right advice. To avoid this, businesses must ensure that they are able to educate consumers and help them either spend or exchange their aging currency before the deadline.
“Confused consumers are an open opportunity for counterfeiters: the harder it is for consumers to recognise legitimate currency, or to know what will be accepted at any particular time, the easier it will be for counterfeiters to pass off their own efforts as real and disseminate them among the population,” said Andrew Crowson, managing director of Cummins Allison UK. “Avoiding this means more than relying on natural churn, such as consumers spending or paying in their cash, to remove currency from circulation. Instead, consumers need to be encouraged to exchange their old for new. Businesses need to ensure that they are training their staff to inform customers on the upcoming expiry dates, and that they have the technology to make exchanging old money for new as simple as possible: for instance, with automatic currency counting machines.”
There are currently 1.553 billion one pound coins in circulation, and 25 percent of all cash payments are for one pound or less. The new coin’s 12-sided shape, milled edges and many other high security features are designed to make it the most secure coin in the world. Along with the new polymer ten and twenty pound notes, due to be introduced in September this year and by 2020 respectively, the new coins will reduce the risk of counterfeiting and extend the lifespan of the UK’s physical currency.
Ensuring that staff are trained to both recognise new currency and help customers understand the differences, and that machines designed to accept cash are updated to recognise the different properties of the new currency, will keep businesses operating in an economy where cash is still king, accounting for 45 percent of all payments.
“With the new pound coin, we have entered the most serious phase of the roll-out of new currency: from here, the process becomes more complex and there are more variables in play,” continued Crowson. “If businesses have the staff, the skills and the technology to help themselves and consumers deal with the switch, then the economy will quickly see the new benefits that this new currency can bring, from reduced counterfeits to a longer lifetime for cash. They will also reduce the chance of consumers becoming confused and disgruntled with the process, and prevent themselves being the target of misplaced anger from any members of the public who find out in the autumn that their collected currency has been removed from circulation.”
For more information on Cummins Allison’s products and commitment to innovation, please visit www.cumminsallison.co.uk.