/ Money

Update: is the new quid on the block set to cause trouble?

New pound coin

Described as the ‘most secure coin in the world’, the new 12-sided £1 will enter circulation at the end of March. Is this a step forward for British currency, or is it more trouble than it’s worth?

Here’s a date for your 2017 diaries: 28 March.

It’s when the new 12-sided £1 coin is set to enter circulation.

Described as the ‘most secure in the world’, the distinctive gold and silver-coloured coin contains a host of anti-counterfeiting features including a hologram that changes from a ‘£’ symbol to the number ‘1’ when viewed from different angles.

The Royal Mint estimates that around one in 30 of the current round £1 coins are fake, so the new quid has been introduced to keep several paces ahead of the counterfeiters. But at what cost to consumers?

Counting the costs

Well, for starters, you only have six months to spend or bank your old £1 coins, as they’ll cease to be legal tender on 15 October.

And with the government claiming that around £1.3 billion worth of coins are stored in savings jars across the country, with the current £1 coin accounting for nearly a third of these, it’s definitely time to start raiding them!

So what about the overall cost to the economy?

Thousands of businesses will have to adapt their self-service checkouts, vending machines and shopping trolleys, while councils will need to upgrade parking meters to accept the new coins.

Things like payphones and fruit machines will also be affected.

Similar changes were needed when the new fiver was introduced on 13 September last year and these didn’t exactly happen without a hitch, with many people reporting that machines wouldn’t accept the latest design.

In fact, only recently, I spotted car parking ticket machines that still wouldn’t accept the new plastic notes.

So what are odds that the new pound coin causes similar problems?

Pounds win prizes

Of course, the introduction of the new £5 note did provide the opportunity for eagle-eyed consumers to make a tidy profit.

Notes with low serial numbers or rare engravings are still being exchanged for hundreds of pounds online.

Only last month, a super-rare Jane Austen fiver, apparently worth £50,000, was found stuffed in a Christmas card. And there are supposedly two more of these notes yet to be discovered…

And with news that some of the rarer old pound coins, such as the Edinburgh £1, are already being sold on eBay, could we soon be treating our small change like a golden ticket to Wonka’s Chocolate Factory, too?

New £10 and £20 notes on the way

A new £10 is on its way this summer, along with a new £20 to follow by 2020. Like the new £5, both will be made from polymer, so they’re more durable, and will be packed with security features to make them harder to counterfeit.

So what are your thoughts on our new currency? Are you pleased we’re making steps to battle counterfeiting? Or is this new money more hassle than it’s worth?

Update: 3 May 2017

They’re touted as being the ‘most secure coin in the world’ and described as ‘indestructible’, but just over a month since the new £1 coin came into circulation, there have been numerous reports of faulty coins.

Reports vary from the coins being cracked or warped to the silver-coloured nickel-plated alloy centre separating from the gold-coloured nickel-brass outer ring. One even claimed the Queen’s head was missing.

The Royal Mint has now admitted that a small amount of £1 coins in circulation may be faulty after they were struck at a rapid rate during production.

Faulty versions of the coin, considered collectors’ items, are already appearing on internet auction sites, with one apparently selling for £2,500

Comments

Some years ago a friend who owned a small country pub showed me a collection of forged notes that his staff had been given. With a little guidance it was easy to spot most of the fakes, but how many of us check the notes and coins we are given? I wonder if the continued problems will hasten the cashless society.

I do like the animated image in your introduction, Joe. Her Majesty was not amused but then saw the funny side. 🙂

The reason magazines date their issues strangely is often because some news is embargoed, eg new model motorhome, only for release in March – so March issue comes out at the end of January

I think that explanation will only apply on the first of April, Bacchanalia.

An opportunity for invention of a till side scanner

Presumably the £1 coin shown is either a mistake (worth a lot) or a forgery since it is dated 2016, and we won’t have any in circulation until 2017? Or is it a bit like magazines in reverse where we’ll soon have Which? February edition out in January (I’ve never understood that marketing ploy with monthlies. Why not bring out the February edition in….February?)

If 1 in 30 current £1 coins are forged then it is clear we need a replacement. Will the banks be checking all the coins we take back and only paying out on the genuine ones?

Well spotted, Malcolm. I’d hope there’s nothing dodgy about the image considering it was kindly supplied by the Royal Mint 😛

I always wondered if the Japanese coins with holes were made by the Polo Mint.

I was told by a newsagent that the month shown on a magazine indicates when it is to be REMOVED from the shelves. i.e. the February-dated edition goes on sale in January, then is removed in February to make way for the next edition.

No !! They simply pass them out to customers, if they find forged coins in their tills they are not going to take the loss. Let their customers take the loss.

Anyone with spare time on their hands can search through their change for fake pound coins using this advice from the Royal Mint: http://www.royalmint.com/discover/uk-coins/counterfeit-one-pound-coins

I wonder how many fakes are handed in at police stations.

I needed a good chuckle 🙂 Sadly, most folk are either completely unaware or, if they notice it, quietly attept to pass it off. Bit like a fiscal ‘Pass the Parcel’ game 🙂

This comment was removed at the request of the user

Interesting, Duncan. Attitudes towards a cashless system are really mixed – I know some people who love it, they never have cash on them (they use their phone or contactless card). This invariably means that I’m the one paying for parking or tips as I prefer to keep change and some cash on hand… I think I’m just used to more rural spots where you might find that a card machine isn’t an available method of payment.

Tips are really important to service industry people, so I suspect we’ll need cash for a long while yet. And there’s always the black market to consider, without which we’d never get that job done as cheaply as we want…

I like the new £1 coin. I don’t think there will be any serious implementation problems. The coin machine industry has had to cope with plenty of previous coinage changes and did so reasonably smoothly, just like the way contactless card readers have sprouted up all over the place.

I think the Indian banknote change was a necessary and overdue act to liberate or neutralise vast hoards of money on which taxes had not been paid or which were forgeries. This illegally-held money was the basis of extensive corruption and crime which were actually exacerbating poverty. The surprise overnight withdrawal of certain higher-value banknotes caused many difficulties but it was probably the only way to manage the operation effectively; nevertheless, there was widespread chaos and a number of deaths as people queued for hours to exchange their notes. Many politicians and ‘wealthy’ individuals have been caught up in the exercise as their ill-gotten gains were exposed and confiscated.

I think the warnings about limited time to spend or bank the old £1 coins can be taken with a pinch of salt. It should be possible to exchange them at banks for a long time after the cessation of legal tender. A few months ago I took some old 50p coins to a bank branch and was given cash in exchange over the counter. I am sure the same facility will exist for the superseded round Pound coins.

Sorry, but I don’t like the new £1 coin at all. It’s clunky and unaesthetic. Think it’s the worst coin the RM has produced . Have had better chocolate coins, tastier too.

It is interesting, Duncan, that the government supposedly has such a detailed long-term plan for demonetisation of our banknotes. I feel that the current acquiescence of the population over cashless transactions and the use of alternative payment methods might beat the government to it. There probably won’t be many bank branches left by 2030 to undertake any large-scale coin and note withdrawals.

This comment was removed at the request of the user

Perhaps a few more cases of outages for terminals and details stolen at post of sale may make notes and coin more attractive.

It may be something to do with the media but there does seem to be very little mention of all the cases around the world where POS terminals have been a vector for crime. I would hate to suggest conspiracy but anyone who followed the Daily Telegraph and its relationship with HSBC and the Barclay Brothers would find plenty of proof that some sections of the media at least are very careful of nurturing their relationships with the big advertisers.

This actually has been true for a long-time where details of bank staff or system frauds were very briefly covered, if at all , by the press.

Duncan – I have no knowledge of the official Indian government line. My knowledge is formed from multiple sources over time. I was not aware of any cover-up of the impact of the banknote withdrawal on the majority of the population – I have read about the consequences in many publications. The 500 Rupee notes were exchangeable for new issues and the 1,000 Rupee notes were exchangeable for new 2,000 Rupee notes. As I said previously, the transition was chaotic but nobody with small quantities of notes should have lost any money as a result of the changeover. So far as I am aware there are millions of credit and debit cards in use in India. In terms of which banknotes to withdraw, my personal view is that the Indian government knew where to strike for the maximum effect and it seems to have had the intended result. No doubt there will be further action in due course against the big hoarders – the recent measure appears to have flushed out a lot of them already since, contrary to what you say, it does seem that the 1,000 Rupee note was the banknote of choice for illegal holdings being both very common and easily converted. I think this is very much a ‘one step at a time’ policy. When Mr Big turns up at his bank with a wad of very high value notes which he has not been able to convert into smaller denominations I expect he will soon have his collar felt by the authorities [one of the outcomes has been a considerable reduction in the amount of legal tender cash in circulation so unofficial conversion is now more difficult].

I was in Burma in 1985 when the Burmese government “demonetised” the 20,50, and 100 Kyat notes. This was announced over Burma TV at 2pm on a Sunday afternoon. The 20 and 50 Kyat notes were very rarely used, but the 100K note was the backbone of the black market, which was how most of the Burmese managed to exist.
The notes had to be handed in to banks, one deposit per household, and they were replaced at a later date with a 75 K note, the reason being that with the 25K note, this would make 100K!
A Burmese friend told me that his brother, who was heavily involved in the black market, had about 100,000 K mainly in 100K notes. When the exchange was eventually made, it wasn’t one for one for all, up to 5,000K it was 1 for 1, up to 15,000 lots of questions, and over that, you have too much money!
A couple of years later all notes above 10 K were again “demonetised” and replaced with 45 and 90 K notes, the Burmese president at the time being very superstitious and 9 was his lucky number. This led to riots and many deaths round about 1989.
I doubt that this will happen in India, but as usual the poor will bear the brunt.
Regards, Jim Hawkins.

I am trying hard to give up using cash so I carry very little with me at all When I need any I go into the bank and get the denominations I want not to a cash machine which only seem to give out £20 notes The new coins will not affect me much PS I still have some pre decimal coins stored away

This comment was removed at the request of the user

I think some of the responsibility has to be borne by the rather lax security protocols employed. Experience has shown that only the ‘dual device’ approach is pretty secure, and using only a single device is prone to all sorts of issues. But the question has to be ‘Is the mobile ‘phone cash withdrawal system inherently any less secure than a man and his bank card?’. I suspect the answer is no, since ATM fraud is widespread, anyway. And when Ug went to his secret cache of lizard teeth to find Og had pinched them, he probably thought ‘Ug need better security’… Not a lot’s changed, really.

Ian – I think the article indicates the Bank was responsible for the type of security employed. I find it hard to believe that the average customer is in a position to dispute the security protocols of their Bank and will assume everything is hunky-dory.

Manifestly Banks are failing on a significant way in the area. And we are not even considering the other ways that do not involve bank cash machines.

And how much coverage has this case had in the UK where Barclays are introducing a variant? The only thing to pop-up:
http://uk.reportnews.eu/stolen-passwords-fuel-cardless-atm-fraud/

Hardly mainstream. Given Which?’s stated mission perhaps we need to have a specialist area where these reports and the UK banks new ideas are given a critical eye.

I just do not see how the average consumer can be expected to handle all the possibilities of new technologies and new apps. We know for fact that Banks lied about the security of the 4 number PIN so why relax our guard now?

I was saying it was almost certainly the bank’s fault, Patrick, but I need to pick you up on the 4 x digit secure code. That code is perfectly adequate for security – there were no lies told – but the ATM has to be set to swallow the card after 3 unsuccessful attempts.

All this palaver about complex security passwords and codes is something of a smokescreen: most fraud and theft in shops is committed by shop staff and always has been, and it’s pretty obvious that the same situation will exist in banks. And many, many cases of so-called ‘hacking’ are nothing of the sort: they’re very often down to social engineering, where well-meaning employees attempting to be helpful to someone they assume to be genuine give out crucial information.

It’s never going to be any different. It never has been in human history. There’s a superb sequence in Life of Brian which exemplifies that beautifully (the walk to the crucifixion) and I’m pretty sure that the Pyramids were flogged several times over to the Phoenicians.

The inadequacy of the PIN was established by academics in the last decade and the research was legally blocked by a South African bank.

The idea that the criminal fraternity could not have done what the researchers proved was possible seems insupportable.

http://www.theregister.co.uk/2003/02/21/how_to_get_an_atm/
https://www.rt.com/usa/354657-chip-pin-cards-blackhat/

If you read the original research you will see it almost certainly requires a bank insider to do it, a fact mentioned by the researchers themselves. And crooked bank insiders have much more lucrative pickings than simply going after an ATM pin .The other attempt requires duplicate machinery to be placed on the ATM, so nothing new there, then.

Of course researchers will always find flaws: they’ve been doing it for years simply because code is basically flawed, and always has been since machine code was first devised. But most scams are nothing to do with elaborate equipment and complex mathematical algorithms. They’re about opportunity and ease of pickings. If you wanted to eliminate all known risks you’d never use anything with a processor. And posting in a forum? God forbid.

The new £1 coin is reminiscent of the old “thrupenny bit” threepenny bit to some people!
However, I think possibly most of the comments above are from folks who are used to an almost cashless society and haven’t encountered the failing sight and less dextrous situation older and infirm people gradually find themselves in as they get more senior. A cashless world is difficult for them, they need to give money to carers etc to purchase things for them, also get on the bus or train.
I think as you are discussing the new currency maybe you should spare a thought for less able bodied people for face different challenges.
I used to work in a post office …I was good at spotting the fake £1 coins, and fake notes, but it is increasingly difficult for folks who handle money nfrequently and on a much smaller scale.

If one in thirty £1 coins are fake, it does explain why so many are rejected by machines.

I remember a ticket machine for a private car park that rejected some 10p and 5p coins. I checked the rejected coins with a magnet and found they were all the newer steel coins. That was long after these were introduced. I have had £1 coins rejected by machines but they seem to be accepted at the second attempt.

This why I never have more than 29 pound coins on me.

Very good. I’m afraid that the book that would explain why this approach is not valid is priced at £30.

Your poor pockets John.

Unless you carry them in 🎒💼👝👜👛💼💰🐷

Yes, it’s deeply worrying if someone drops a pound in my hat as they walk past.

Ian Butterworth says:
6 January 2017

Good design: it looks like a 3d bit. and buys about the same.

I also liked the 3d bit with Thrift on the back (changed to the portcullis when the Queen ascended the throne). It bought a bag of chips in my youth, now they cost a quid, just as you say. But we do earn a lot more! That is what I find difficult to understand about inflation; we demand more pay, so we feel better off, prices go up, so it buys about the same. The problem is we lose our sense of what things are worth. I think a pound for a bag of chips is extortionate, but then petrol was 3/9d a gallon.

The new £1 is thinner, lighter, but around 1mm bigger across the widest point. After they cease to be legal tender in October they can still be deposited in your bank. The mint are making 1.5 billion and the date is the date of production; as I imagine they made some last year the one in the intro is probably not a forgery!

Ah, you mean the new 3d bits. I’ve still got some of the silver ones, though I’m not old enough to remember them being in use.

At the local fish & chip shop, a bag of chips costs £2 and haddock & chips is priced at £6.80.

Is that for a large portion or regular? Eat in or take-away? A large haddock & large chips to take out is around £5.75 here, but there is no consistent definition of “large”. My money-saving tip is to only have it once a week and have cod on the other days.

That would be for regular chips, sir. Small and large portions are £1.70 and £2.30. It’s amazing what information is online these days.

Cod and Haddock is around the same price at our chippy, and we slightly prefer haddock. We also find it is cooked to order, so you don’t have to take a fish that might have been kept warm for some time. Portions are much bigger than the 1/3d days, and we usually share a bag of chips.

Silver thrupenny bits were so small, they’d drop through the seam in your trouser pocket if your Mum didn’t keep them sown up from the wear and rear that took place with a pocket full of old pennies.

They should have arranged all the notes and £1 coins at the same time!!!!!

It would have been cheaper and less hassle for the vendors, it’s a must to make the changes as the fraudsters are having a field day, it’s to easy with technology now, for the fraudsters to forge cash and cheat the public as well as the banks, but more importantly the Public!

The introduction was needed, a long time ago, to protect the public from being ripped off!!!

It’s better to make the change, but should be done all at the one time!!! To make it easier for all concerned.
It’s a much needed and required change.
It will be hassle for all concerned, but has to happen. The hassle for all will be worth it in the long run!!!

Perhaps you don’t remember the problems that occurred during decimalisation in 1971 when just some of the coinage changed and none of the notes. That involved a change in denominations and values, though, so much more complex.

I expect the authorities do these things in stages to keep a rolling production process through the Royal Mint and the banknote printers. It takes over a year to produce enough coinage to launch a new issue of just one coin denomination and the metal has to be paid for and production staff paid a long time before the old stock is returned. I should think the coin-operated vending machine industry prefers to change their machines one step at a time as well; the coin validation mechanism is very sensitive so if one coin denomination is rejected it’s not the end of the world but if every coin is rejected it could be catastrophic. The Showmen’s Guild might have some opinions on the matter as well since, so far as I know, you can’t use a contactless card on the waltzers and dodgems.

Sylvia says:
6 January 2017

Brilliant – bringing back the lovely old three-penny bit shape with the rose, thistle and shamrock for our British isles.

Brian says:
7 January 2017

If there are so many counterfeit £1 coins around and they weigh and look like genuine ones, when I ‘bag up’ my loose change and take it to the bank in £20 bags they just weigh them and as long as they are the right weight accept them.

I guess I could have unknowingly put counterfeit ones in there so wonder if these are then checked before the bank just re-circulates them when they open a £20 bag of coins to put back in to their tills ??

“most secure” , yeah right. The plastic £5 note was supposed to be secure but fakes were out over christmas.
I think they forget that the security or not, it’s the lowest common denominator that drives how secure something is, and that’s still a human being. So I expect to see fakes out and about in no time.
And the fact that machines will need to be altered to take the new and the old coins leaves machines open to being given all manner of fakes.
So I’m not impressed.

So what’s the answer then, William? We can’t just let the pounds in our pockets and the wads in our wallets become increasingly adulterated. I think the new £1 coin will outwit the counterfeiters for quite a while.

I expect Prince Charles pops into a photo booth every few weeks on the off-chance that a new image will soon be required. That’ll fox the forgers for a bit.

Pay me £50m and I’ll tell ya. But making things that don’t should up to microscopic analysis won’t help the little old man or woman in the street that struggles to see that level of detail so it’s all a waste of time and money putting it there. And yes I do have an idea but it so out of the box it probably won’t work.

This comment was removed at the request of the user

Forger Fred says:
7 January 2017

It won’t take long to re-jig my bi-metallic coin stamping machines. My vegetarian plastic fivers have been very effective. The trouble is procurement of supermarket trollies to carry away the finished new pound coins – trollies only take the old pound coins at the moment and I have stopped minting them; one can’t win.

I don’t like the the new fiver; too rigid so that it doesn’t easily fold into a purse, when in there, it pulls other bills out with it. Not looking forward to the new £20 and other bills in polymer.

Kate says:
7 January 2017

So, if supermarket trolleys are to be converted, what about all the people who’ve bought and used tokens?

I presume most people only bought one or two tokens and have made plenty of use of them. It’s just normal obsolescence – they can either use a new pound coin or invest in a new token. I am not sure I understand why people bought tokens when most have a pound in their pocket or purse. Perhaps the supermarkets won’t convert their trolleys but will sell old-style tokens at £2 each!

I’ve never shopped in a supermarket with trolley locks. The local Morrison’s has them but does not use them. I know people who have metal discs to unlock trolleys, on their keyrings, so I assume that the system is not very sophisticated.

Indeed – the supermarkets could hold a “token amnesty” and exchange old for new.

The change will cause more problems as who will pay for all the machines and devices which will have to be altered, not the treasury l bet. Whilst l agree that the changes are required to stop fraudsters 6 months will not be long enough for some people to make the changes to their routines.

I am perplexed over what routines people have involving pound coins that they cannot adapt to over six months. The older people are the more they have had to do this throughout their lives – including when the pound note was replaced by a coin – so for them it’s a doddle. Younger people might have to carry marbles around with them to help them remember about the new coinage, but what if they lose their marbles?

This comment was removed at the request of the user

How many supermarket trollies are there in the UK? Selling tokens is surely more cost effective than changing the mechanism: many charities sell these tokens on a key ring, so they could potentially benefit.