By Andrew Crowson, Managing Director of Cummins Allison Ltd.
Given that we stand on the brink of the biggest changes in UK currency since the £1 note was withdrawn in 1988, many retailers are already asking what the impact of the new polymer £5 notes will be when they are rolled out this September.
If all goes according to plan, businesses and consumers will soon be reaping the benefits of the new currency, such as increased fraud prevention and durability. Yet alongside these benefits, retailers need to be certain that they are ready for the new notes and the technical challenges and even confusion they may introduce; both to the industry and, more crucially, to their customers.
Undoubtedly the industry will benefit hugely from the new polymer notes, as they will help to reduce fraud and increase security. This should help to save retailers vast quantities of money as it will be much harder for criminals to create and use counterfeit notes.
Given that the Bank of England removed almost £5 million worth of counterfeit notes last year alone this can only be a good thing. On top of this, the new notes are more durable – the Bank of England claims they will last 2.5 times as long as the current versions, meaning less damaged notes to cause issues for retailers and shoppers. However, retailers need to start putting their processes in place now if they are going to be ready in less than 6 months' time; and it's not just processes and potentially equipment that will need to be ready.
Point of contact
The general public hasn't seen any major changes to our currency since 1988, as all more recent changes have been minor in size or cosmetic amendments. As a result, these new major changes have the potential to create confusion and questions from customers in the weeks and months following their introduction. The change will see every part of the new notes, from design to dimensions being radically different. This will require customer service staff to be well versed in being able to explain to customers that the notes they are giving them are indeed real, as well as being able to identify them themselves. Potentially, without the right processes in place, a store could face significant challenges at the checkout which they will more than likely want to avoid. This is especially true while both cotton and polymer notes are in circulation.
Communication is key
Given the dwindling amount of time available to retailers, they should be starting to think about training employees as soon as possible. It will be an essential ingredient to a smooth transition. Employees will be the front line between the organisation and consumers, but they will also be the ones who need to handle the cash itself. Training will need to cover how polymer currency differs from the paper notes that people are familiar with, as well as making them aware of any changes in equipment that might be necessary to accommodate the new notes. This will help eliminate as many of the issues as possible before the notes enter circulation.
Technical challenges shouldn't slow down your business
Retailers regularly need to deal with large quantities of cash and as a result there's a good chance that they will need to update their equipment as a matter of urgency in order to keep things running smoothly. The changes in texture and size alone, together with the new anti-fraud measures, mean that some cash counting equipment will be unable to cope with the polymer currency. There's also an added challenge of the polymer notes having a tendency to cling together – especially when new – making manual counting more difficult and potentially increasing reliance on cash counting machines. In order to avoid this, counting equipment has to have adequate anti-static capabilities. The last thing that retailers need to deal with is cash counting equipment miscounting or failing entirely as a result of the polymer banknotes.
Taking a long term view
The government will be providing support alongside the Bank of England to ease the transition, but it'd be unwise to leave things to the last minute and risk not being ready. Some retailers might give in to the temptation of putting in place temporary solutions to deal with the new polymer notes, but this probably won't pay off in the long term. New £10 and £20 notes, as well as the new £1 coins that have already entered production, will follow in quick succession, meaning that short term fixes will fall short; especially as any confusion felt by businesses will be felt just as keenly by their customers. Being prepared and putting everything into place now will mean that there will be far less disruption as currency continues to evolve, ensuring 'business as usual' for retailers
Retailers may be the first place that the general public encounter the new polymer £5 note and as such have a lot more responsibility weighing on their shoulders to ensure a smooth introduction. Thankfully there's still enough time to put the right processes in place and ensure the right equipment is being used to deal with any potential challenges. If retailers act now they can view the introduction of the new notes not with fear, but rather looking forward to the benefits that it will bring
About the Author
Andrew Crowson, is Managing Director of Cummins Allison's UK branch, based in Coventry. He joined Cummins Allison in 1998, becoming Managing Director in 2012. Over his time with the company he has specialised in selling into the Banking and Retail sectors. Crowson has been directly involved in or overseen the branch's development into the banking and retail sector, which now boasts such blue chip clients as The Royal Bank of Scotland, Metro Bank, Allied Irish Bank, Tesco, ASDA, McDonalds and John Lewis.