Confidence in our banknotes is everything. How would life go on if we weren’t happy that the currency in ATM machines was genuine? Hence a new document from the banking sector, the Code of Conduct for the Authentication of Machine-Dispensed Banknotes (‘the code’) covers the integrity of banknotes at cash machines. It’s by the Strategic Cash Group (SCG) which also published its formal response to a consultation which closed in July.
The code sets out banknote authentication standards for those businesses that self-fill their ATMs or self service check-outs using banknotes tendered by the public (a process known as ‘local recycling’). These are comparable, the SCG says, to the standards already required of the wholesale cash industry (which continues to supply the vast majority of banknotes acquired by the public). Nearly 30 consultation responses were received from ATM deployment, retail, banking, cash-in-transit and other companies.
Chris Salmon, Executive Director for Banking Services and Chief Cashier, said: “We are grateful to all of the organisations that have provided feedback to the consultation. By clearly setting out the responsibilities associated with local recycling, the Code will help organisations make well-informed choices about their cash management processes. And compliance with the Code means that banknotes recirculated into the economy can always be robustly authenticated: a key pillar in maintaining the public’s confidence in the currency.”
Adrian Kamellard, CEO of the Payments Council, which is overseeing the code, added: “The Payments Council’s central position in the industry makes us well placed to further manage the Code and to ensure that it delivers real benefits without getting in the way of business operations, especially for small retailers. Ultimately it’s all about working together to uphold the public’s trust in cash and we’re looking forward to working with all parties involved to put the Code into practice.”
Refinements to the code are expected as cash technology develops. Any significant changes to the code would be subject to further public consultations.
The code and consultation response document can be found at:
http://www.paymentscouncil.org.uk/what_do_we_do/cash/cash_recycling_code/
The Framework for the Testing of Automatic Banknote Handling Machines is a voluntary arrangement operated by the Bank of England that tests machines with known counterfeit types on a regular basis. It is extensively referenced in the code. The Framework is one pillar of the Bank’s efforts to maintain a high level of confidence in Bank of England banknotes. FAQs can be found at: http://www.bankofengland.co.uk/banknotes/Pages/retailers/framework.aspx.
The code covers Customer-Operated Cash Dispensers (COCDs), in particular ATMs and self service checkouts. Transactions where banknotes are handed over by a person are not included. This is because members of the public receiving banknotes from another person, at a till or branch counter, have the opportunity to refuse the banknotes if they are not confident that they are genuine. This is not possible where the notes are machine dispensed. Moreover, it would be difficult for a hard of the public to prove whether a given suspect banknote came from a particular machine, and it would be hard too for the machine operator to prove it had not. Code compliance helps to protect both parties. Seven banks in Scotland and Northern Ireland are currently authorised to issue banknotes on a commercial basis. The banknotes issued by these banks are not covered by the current version of the code but are expected to be included in a future version.
The Bank of England also runs a voluntary ’framework’ for the makers of automatic cash handling machines and their customers. Such machines accept, count or sort banknotes and automatically decide whether a banknote is counterfeit or genuine. Some machines can also sort and separate banknotes into categories such as genuine fit, genuine unfit and suspect or counterfeit. Likewise the Bank issues advice about pens, UV lamps and other kit that can help a retailer decide if a banknote is genuine or suspect. Similarly an online brochure ‘Take a closer look’ details the security features on a banknote itself – whether watermark, or metallic thread, something as sophisticated as a holograms or as simple as its size – that you can check to decide that a banknote is not a forgery.
Visit http://www.bankofengland.co.uk/banknotes/Documents/kyb_lo_res.pdf
If you have a forgery
It is a criminal offence to keep or pass on a note that you know to be counterfeit. If you have a note that you believe is a counterfeit the Bank of England says that you must take it to the police as soon as you can. They will provide you with a receipt and send the counterfeit to the Bank for analysis.
Did you know?
Under section 18(1) of the Forgery and Counterfeiting Act 1981 it is a criminal offence for any person, without the prior consent in writing of the Bank of England, to reproduce on any substance whatsoever, and whether or not on the correct scale, any Bank of England banknote or any part of a Bank of England banknote.
