• Visit our partners: Our Partners:
  • Visit our partners: Our Partners:

How Will the UK and Commonwealth Change Its Money?

Written by Kevin Jennings

https://www.publicdomainpictures.net/en/view-image.php?image=2623&picture=british-money

Likenesses of a nation’s head of state have been appearing on money for about as long as government-issued currency has existed. In Modern times, many of us see our money as a fixture of society. Though currency has seen updates over the years, these are predominantly done with the interest of making counterfeiting bills more difficult. Security features may be added, but the fundamental design of the money remains largely unchanged.

For those in the United States, the faces on paper money haven’t changed since 1928. There have been innumerable variations to the quarter put out on a yearly basis, but George Washington’s portrait has remained the most standard. Likewise for Britain, Queen Elizabeth II has been featured on paper currency since 1960, longer than the average person has been alive. With the passing of Queen Elizabeth, it’s not just England that will be affected. There are currently over 30 countries that featured Elizabeth on their currency, some of which have been doing so longer than England has.

Historically, nations with a monarch or despot have been used to having to mint new currency whenever someone new came to power, but seldom has one person ruled over a nation for so long. So how will this affect the currency of England and the Commonwealth Realms?

A Brief History

https://en.wikipedia.org/wiki/File:Athelstan_924-939_coin.jpg#file

              The portrait of the king or queen of England has been featured on government-minted coins for over a millennium. This began with King Athelstan, in the 10th century. As far back as 800, the name of the monarch was printed on the coinage, but Athelstan was the first English monarch to have his face there as well. In an age before photography, these coins were often the only way that common people would ever actually see the likeness of their ruler.

              In the centuries that followed, not all kings of England would have their portraits printed on coins. Given that the coins featuring the likes of King Athelstan or King Edgar barely looked like they were depicting humans, it’s hard to blame those that chose to only print their names instead.

              However, as the process of minting coins improved and the images printed on the coins were far more detailed and representative of the actual monarch, it became standard practice for the face of England’s king or queen to appear on their coinage. In the 17th century, under King Charles II, this was further standardized so that the profile of the monarch would always be facing in the opposite direction of the one that preceded them.

https://onlinecoin.club/images/coins/United_Kingdom/cf2340a1-5acf-4bb0-a353-7f0274351038.jpg

              The only person to break this pattern was King Edward VIII. By tradition, he should have been featured on coins facing right, but he felt that would be showing off his bad side and was instead depicted facing left. This was largely irrelevant as King Edward abdicated the throne in less than a year, so these coins were never put into circulation. King George VI chose to face left on his coinage, the direction he would have faced had Edward not chosen to break tradition. Following this, Queen Elizabeth II was shown facing right on all currency, and King Charles III will again be facing left.

              Although the British monarch appearing on coins is a centuries-old tradition that is refined to the point of dictating which direction they should face, the same cannot be said for paper currency. Coins have been used across the world for thousands of years, but paper money is a different story entirely. The earliest paper money dates back to 8th century China, but it wouldn’t see use in Europe until the mid-17th century.

              These earlier banknotes were also very different from what we think of today when we think of money. The word “banknote” is used synonymously with paper money, but originally it wasn’t a centralized, government-issued form of legal tender. Instead, it was a very literal note from a bank. These notes were written by hand and promised to pay whoever possessed such a note the amount of money written on it. A note from one bank was typically only valid at that bank.

              It wasn’t until 1921 that the Bank of England gained a legal monopoly on banknotes, resulting in the paper currency that we are all familiar with today.  Even then, it wasn’t until 1960 that Queen Elizabeth II became the first monarch to appear on British banknotes, seven years after she was crowned. Because of this, there isn’t a lot of tradition surrounding paper money in England.

              It is expected that King Charles will be featured on future banknotes, but this has not been officially confirmed at the time of writing this. The Bank of England has stated that notes with the queen on them will remain legal tender, but they are refraining from making any other statements until after the official period of mourning.

https://pxhere.com/en/photo/931369

England’s Long-Term Plans

            For anyone thinking that England is going to suddenly recall all of its money and replace it with money featuring the new king, that’s just not going to happen. There are thousands of years of precedent to show that money featuring leaders both past and present can remain in circulation at the same time. Future money will be printed featuring King Charles, but there will not be a concerted effort to remove all existing currency from circulation.

              Exceptionally worn or damaged coins and banknotes that are deposited at banks are typically removed from circulation and replaced with newer ones. This process will continue and should be the primary method by which the currency is replaced. It will be an extremely slow and gradual process that will take years to complete.

              Of course, while the process for updating coins is much more formalized than the updating of banknotes, it is unknown when it is actually going to begin. Like the Bank of England, the Royal Mint has also declined to announce any details during the period of mourning. All they have said thus far is that coins featuring Queen Elizabeth will remain legal tender, and that they will continue minting coins as normal during the period of mourning. This implies that they are still minting coins featuring the queen, and it is expected that no change will happen until the 2023 coins begin to be minted.

https://pxhere.com/en/photo/1023504

              We said that this will be a slow and gradual process, but we already have a pretty good idea of how long it will take. In 2016, England switched from its traditional paper banknotes to plastic banknotes, generally referred to as polymer banknotes.  The process began with five-pound notes, then worked through the ten, twenty, and fifty-pound denominations. It has been six years since this began, and the process is just now coming to a close on September 30 of this year.

              However, that situation was actually quite different. The country was switching from paper to plastic banknotes because they are more durable and more difficult to counterfeit. Because this was a fundamental change to how the currency is made, old paper currency will no longer be considered legal tender as of September 30. Any existing paper notes will still be honoured by the Bank of England, but citizens will not be able to use them to pay businesses for goods and services.

              So we know that the process of replacing all of the banknotes can take about six years, however, that was when they were actively trying to replace all of them. With paper notes losing their status as legal tender, people had no choice but to ensure all of their money got replaced. Since all money featuring the queen will remain legal tender, there will not be such a rush to replace it. Given how costly and time-consuming this very recent endeavor must have been, one can assume that the Bank of England isn’t too keen on suddenly having to replace all of the banknotes again either.

              With the polymer banknotes being more durable, this process will likely take even longer now than it would have in the past as the bills won’t need to be replaced as frequently due to damage or wear. Even once the Bank of England and the Royal Mint make their official announcements, it is unlikely they will have any sort of specific timetable for when all of the money will be fully replaced. Experts estimate that a person born this year will reach adulthood before they see money with Queen Elizabeth fully phased out of use.

Other Commonwealth Realms

https://flic.kr/p/728A7K

            The process of changing England’s money will be very slow, but the rest of the Commonwealth is in even less of a hurry. Some Commonwealth realms, such as Jamaica, had already removed the queen from their currency. Because the Commonwealth realms are sovereign states that are only voluntarily connected through the monarchy, others such as Antigua and Barbuda have seen the queen’s death as an opportunity to hold a referendum to become a republic and cease being a Commonwealth realm.

              For the remaining nations, there are no rules or laws in place about updating their currency. According to The Bank of Canada, “There is no legislative requirement to change the design within a prescribed period when the Monarch changes.” Similar to The Bank of England, the Bank of Canada also just switched to polymer banknotes which are expected to remain in circulation for years. Canada’s process for updating money is also rather slow, with the time between beginning design on a new bill and actually printing that bill taking years.

              Likewise, New Zealand won’t be updating their money anytime soon. Though they also remove worn and damaged currency from circulation, they have a stockpile of fresh coins and banknotes waiting to go. The Reserve Bank of New Zealand has indicated it has enough coins printed that it will not need to introduce any coins featuring King Charles for several years, and that it will be even longer before they run out of the $20 bills that feature the queen.

              Australia has announced it will begin minting new coins featuring King Charles in 2023, though it will likely be years before he appears on circulated banknotes. The Reserve Bank of Australia explains that it can be years between when a banknote is printed and when it actually enters circulation, depending on how quickly the existing currency needs to be replaced.

https://commons.wikimedia.org/wiki/File:2019_Reuni%C3%A3o_Bilateral_com_o_Pr%C3%ADncipe_Charles_-_48848389972_(cropped).jpg

Wrap Up

            Though several countries around the world may be changing their money to feature King Charles III, it’s going to be a very slow process. Coins will begin circulating next year at least in England and Australia, but new banknotes are unlikely to appear anywhere besides England for years to come.

              We’ve already discussed how there is a delay between notes being printed and circulated, and how this delay is only likely to be further extended thanks to the much more durable polymer banknotes. But there’s another issue. Between credit and debit cards, Apple and Google Pay, Paypal, Cashapp, and the myriad of other forms of digital payment, physical money is becoming less and less important each year.

              On average, over 300 ATMs are shutdown every year in England, a trend that has been taking place for years. Keeping coins and banknotes circulating is a costly endeavor, and one that the average person has less and less use for. Though we can expect to see King Charles printed on British money next year, the future for the rest of the Commonwealth is unclear. Most of the other Commonwealth realms have displayed a reluctance to start rolling out newly designed money, and with society constantly making a larger push towards being cashless, many countries may delay the change long enough that they’ll never need to make it.

Related Articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Stay Connected

50,682FollowersFollow
527,000SubscribersSubscribe

Random Article

00:07:33

Veryovkina Cave: The Deepest Cave in the World

Any fan of horror films can tell you that there’s something inherently creepy about caves. When it isn’t the tight, claustrophobia-inducing spaces or the...

Latest Articles