Bank of England set to shed some pounds with new SME icon

By: James Ainsworth

Date: 21 June 2010

Twenty pound notes

As of 30 June 2010, the £20 note featuring the composer Edward Elgar is to be withdrawn from circulation. The original black-and-white £20 note was first issued in 1725 by the Bank of England - while I can’t say I have seen one and I am no Numismatist [ed’s note: get you, a coin dealer], my inner geek has always hotly anticipated the issue of ‘new’ money.

The Elgar note has been phased out since 2007 with a new face, Adam Smith [don’t all say “Who?” at once – see below] and by a ‘slightly brighter’ colour design to combat fraud, explains Andrew Bailey, Executive Director, Banking and Chief Cashier of the Bank:

“The new £20 has a number of new design features; it includes a much larger silver holograph.

“It is very important that we produce notes that the public can recognise as being genuine.”

The new design will help to avoid counterfeiting of the most common note in circulation - between 1.1 and 1.2 billion. And while only one per cent of all notes in circulation are fake, the counterfeit industry remains appealing - designs need to be updated regularly to outwit forgers 

If you run a business where you need to identify genuine banknotes, the Bank suggests the following measures for businesses that should help: 

  • Train staff by using Bank of England counterfeit detection material, including leaflets, posters, a short film and a training CD.
  • Establish an anti-counterfeit checking policy and ensure that staff are aware of it.
  • Avoid confrontation and do not put staff at risk of attack or injury.
  • Where possible, retain the counterfeit note(s) and ask for another means of payment. Take the customer's details and give them a receipt, so they can be reimbursed by the Bank of England if the notes are found to be genuine.
  • Call the police as soon as possible and hand over the counterfeit notes, or take them to the police station.

For several months after the end of June, most banks, building societies and Post Offices will accept old £20 notes for deposit to customer accounts and other customer transactions. The old note will remain legal tender for small businesses that handle cash transactions for some time but it is at the owner’s discretion how quickly they decide to decline the Elgar-faced note.

While previous icons on the £20 note included William Shakespeare and Michael Faraday, the appearance of Adam Smith on the new note is particularly appropriate for small firms.

Smith was a key proponent of free trade and capitalism and in his most famous work, ‘The Wealth of Nations’ (1776) he outlined the economic ideology that is still highly regarded today. Andrew Bailey explains why the 18th-century economist was chosen.

“Adam Smith was not just an economist; he was also a moral philosopher, a very famous figure. The insights he developed have stood the test of time; they lie at the heart of our understanding of the economy and human behaviour.”

Smith’s most often-quoted soundbite is:

"It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own self-interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages."

  • The Bank of England will always exchange its old notes. To exchange an old note for a new one, either take it or post it to: Dept NEX Bank of England Threadneedle Street London EC2R 8AH

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