The much anticipated arrival of new pound banknotes featuring the image of King Charles III was announced by the Bank of England in December 2022. The gradual introduction of these polymer banknotes should see them arrive in British wallets by mid-2024. But what kind of impact will these notes have on the environment? Is choosing a plastic-based material wise and reflects the impassioned environmental concerns of the new monarch?
The staggered introduction of the new banknotes is intended to minimise a negative impact on the environment, with the new notes featuring Charles III “to replace worn banknotes and to meet any overall increase in demand for banknotes,” according to the Bank of England. Traditionally, the British pound notes were paper-based, but are being removed from circulation in favour of plastic bills, making Britain the world’s largest economy that solely uses plastic-based banknotes. A deeper look at the long-term consequences of plastic banknotes for the environment, however, suggests these new notes may not be as green as they seem.
The truth about plastic banknotes
The extensive consequences of plastic use on our environment are now widely documented and have become a key target for environmentalist vitriol, and quite rightly. Plastic poses a considerable threat to most natural ecosystems, destabilising the fragile equilibrium on which flora and fauna have depended for millions of years, not least our oceans. The never-ending search for ‘eco-friendly’ plastics seems therefore misguided, and actors across all industries should instead be looking to real, natural alternatives.
This is also true for the banknote printing industry. In spite of the tenacity of the Bank of England’s conviction that plastic is the way to go, a recent study by UK firm Moneyboat has suggested that plastic banknotes represent almost treble the greenhouse gas emissions: new £10 notes release 8.77kg of CO2 compared to their cotton-paper predecessors 2.92kg.
Plastic notes, now used in over 20 countries, were vaunted as a very modern solution to age-old problems, such as fraud and counterfeiting, and their longer life-span was heralded as a smart solution to negative environmental fallout. “Changing our bank notes from paper to polymer over recent years has been an important development, because it makes them more difficult to counterfeit, and means they are more durable,” Bank of England Chief Cashier Sarah John, the official responsible for banknotes, said in a statement. Laudable, but plastic is plastic. The Moneyboat study revealed that polymer banknotes create twice the amount of carbon dioxide at the manufacturing stage than cotton-based alternatives, and what about disposing of the tonnes of inevitable plastic waste?
Furthermore, in spite of the above-mentioned enthusiasm for their longevity, it was revealed that almost 50 million £5 and £10 notes had to be replaced between 2016 and 2020 due to “wear and tear,” a key problem allegedly highlighted for cotton notes.
Stick with cotton?
Cotton, the traditional material used in the banknote industry, remains an undeniably more ecological alternative to polymer. Its renewability, sustainability, biodegradability and lower carbon footprint remain its principal advantages. Moreover, “enhancing sustainability further, the cotton substrate of the banknotes is derived from cotton combings, a by-product from the textile industry as they do not have the qualitative properties required for textile production. For banknote production, the short fibres are an ideal high-quality raw material,” according to Finance Monthly.
Furthermore, the assumption that plastic banknotes are ‘impossible’ to counterfeit was recently debunked following the arrest of a man in Romania who allegedly led a gang who forged 17,000 fake 100 RON (£18) banknotes (£310,000). The banknotes produced by the gang were almost impossible to detect, throwing the Bank of England’s assertion that polymer notes are impossible to counterfeit once again up in the air. The reality is that cotton-based banknotes are inherently ‘safer’ than their plastic equivalents: Polymer is a blank medium without any security features, which are added later. It is the exact same material used for FMCG packaging and even to wrap the flowers at your local florist. Banknote paper already includes anti-counterfeiting technologies to which other security features are also added during the printing phase. The increased safety of paper banknotes is underlined by the counterfeiting data regarding the euro banknotes: 376,000 counterfeit euro banknotes withdrawn from circulation in 2022, second-lowest level ever in proportion to total banknotes in circulation, according to the ECB. Furthermore, it appears that counterfeiting is about 2.5 times higher for pound notes (made of polymer) than for euros (made of cotton), according to figures from the two central banks. Cotton banknotes are indeed the counterfeiters’ number one nightmare.
Of course, an optimum balance between sustainability, security and longevity has to be found when producing the ideal, modern banknote. This is why new solutions and innovations need to be explored, including hybrid solutions and state-of-the-art security features that respect industry norms on sustainability.
Behind the Bank of England, the banknote manufacturer De La Rue Currency is the current leading promoter of plastic notes. De La Rue’s emphasis on polymer increasingly looks like a race to the bottom due to the inherent problems with plastic mentioned above, but will allow the company to maintain its prominence in the UK, introducing the new banknotes featuring King Charles III, while using the British notes as a model for export markets.
With a new King on the throne who extols the virtue of environmental protection, perhaps having his image on a plastic note is not the right way to pay homage to him.
