On 28 March 2017, the new 12-sided £1 coin will begin its life in circulation. It marks the beginning of the end for the current design, set to be discontinued from 16 October 2017 onwards.
The Royal Mint is producing 1.5 billion new coins in a bid to prevent illegal counterfeiting operations, something the Treasury has not been able to control in the past few years. In 2015, they admitted that 50 million bogus £1 coins were in circulation, many of which were exact enough to fool automated payment machines.
After a 10 week public consultation, the Royal Mint have finalised a design said to be “the most secure coin in the world” and near impossible to replicate.
It includes extremely small micro-lettering and a latent image that changes when the coin is seen from different angles. There’s even additional high security measures kept a secret from the public to thwart the fraudsters.
Although the modernistic 12-sided design may be embraced by some, certain businesses across the UK will have to adapt to the change. If you believe your company will be affected, it’s recommended to act as swiftly as possible to ensure the transition runs smoothly.
Initial Action
Before the 28 March deadline, companies that rely on coin-operated devices should contact their equipment suppliers and organise changes to their machinery. They will either need to be altered or replaced altogether.
It is believed around 40% of the UK’s coin-operated machines will require updated mechanisms, affecting such appliances as parking meters, self-service checkouts, vending machines and betting terminals. It’s reported that supermarket trolleys should be resistant from the changes, however.
If you use an automatic coin counting machine, a software and/or hardware upgrade will no doubt be required. Again, contact the supplier as soon as possible to know how they’re planning for the change.
For high street stores, the cash-handling process will be slightly different for your staff to deal with. Make sure they’re aware of the new security features on the incoming £1 coin and exact circulation dates.
Co-Circulation Period
28 March to 15 October 2017 will be the co-circulation period where both the old and new £1 coin will be in use. Businesses must accept both coins as legal tender during this interval and inform customers of this policy.
During this transition stage your business will amass plenty of obsolete pound coins that are soon to be decommissioned. What to do with them has been addressed by the Chief Secretary to the Treasury, David Gauke, who says:
“Our message is clear: if you have a round one pound coin sitting at home or in your wallet, you need to spend it or return it to your bank before October 15”.
High street banks and the Post Office will exchange the old style coin for either personal or business use. If you’re to be depositing a substantial amount of the old currency, it’s best to contact your bank directly to confirm their specific regulations.
Demonetisation
When the demonetisation process is complete on 16 October, all businesses must provide coin-operated machinery that recognise the new £1 model. Additionally, you should not distribute the old coin back into circulation in any circumstance.
You can still continue to accept the round-style pound from paying customers, although are under no obligation to do so. Continue to send back in any old £1 coins as and when you receive them.
For further information on the process and how your company may be affected, head to the Royal Mint website for more resources.
If you’re running a business and are looking for funding, the Treasury’s new finance scheme could help.