The Strategic Cash Group (SCG) in the UK, which consists of the Bank of England (BoE), HM Treasury, the Royal Mint, Barclays, RBS, Lloyds, HSBC and other leading banks in the country, has launched a consultation about a new code of conduct for the authentication of machine-dispensed bank notes, which is designed to protect the validity of the currency.
The UK Payments Council will take over the development and maintenance of the voluntary code of conduct once the SCG consultation ends on 20 May this year and be responsible for producing a database of ‘accredited’ retailers.
The new code is intended to authenticate bank-notes which are redistributed to the general public in the UK via automated machines and address the issue of ‘local recycling’, which occurs when retailers re-stock their own cash machines or self-service checkouts on-site with notes from the till, for example, or when a bank branch puts customer deposits into an automated teller machine (ATM). There are now some 30,000 self-service check-out terminals in UK retailers, capable of dispensing notes, and more than 65,000 ATMs in the UK LINK scheme, which is operated by VocaLink and to which all the major banks subscribe, alone.
The proposed code of conduct seeks to ensure that all such UK bank notes dispensed by automated machines are authenticated to the same high standards achieved by the present Note Circulation Scheme, which puts fresh currency into the country and has existing protections to stop fraudulent bank notes entering the mainstream. The vast majority of BoE pound banknotes are still released via a network of wholesale cash centres in the UK, but the increasing ‘recycling’ issue means that action had to be taken.
Commenting on the code, and its administration afterwards, Adrian Kamellard, chief executive of the Payments Council, said: “The SCG’s desire to establish a new code of conduct for recycled bank notes responds to a shift in the way we [in the UK] obtain our notes. Over the past decade new ways of getting cash through automated machines have become increasingly available –with many more retailers or businesses owning and stocking their own cash machines or self-service checkouts. A new code of conduct responds to these developments and will help maintain consumer confidence in the cash they receive.
“The Payments Council is excellently positioned to take over the next stages in the development of the code,” he continued. “We will be working closely together with other stakeholders in the cash community, including the BoE, but also to reach out to local stakeholders, such as retailers, who will need to be actively involved.”
• For more details about the consultation please click here.