In December 2014, the Bank of England made a decision to introduce Polymer Banknotes into circulation, starting with the £5 notes in 2016 and the £10 note in 2017.
Cash Management Solutions has voiced its concerns in an open letter to the Bank of England, wrote by CEO, Brendan Doyle:
Dear [Name Supplied],
I am writing to put some questions to you about the process the Bank of England has followed regarding the introduction of Polymer notes and to tell you that I would like to see an independent review of this decision.
I had understood that the Bank would engage all stakeholders in the process and that a key element of the decision making process was to be an analysis of the costs of the change-over to the private sector. I was, therefore, very surprised to see that a decision was announced within days of the Christmas holiday with no reference to the cost benefit analysis having been completed. Indeed, no mention was made of any of the concerns I raised during the consultation process. Given the position we are now in, I have asked that the matter be raised with HM Treasury as I believe that an independent review of the decision is necessary.
My concerns are as follows;
- As the Bank of England stands to gain financially from the changeover, the consultation process should have been conducted independently with a remit to undertake a cost benefit analysis for the whole economy.
- Given that we are still not aware of the costs of introduction, I am concerned that the consultation may not have been thorough & transparent.
- As it is, the decision may involve a significant transfer of costs from the public sector to the private sector.
- That this decision may be consistent with a number of decisions by the Bank of England, over a long period of time, that have increased barriers to entry in the cash processing industry, resulting in higher long term costs for consumers and businesses.
- That a number of businesses, especially smaller ones, associated with cash provision, may suffer disproportionately from this decision.
- Conversely, a number of businesses, especially larger ones, may gain financial & commercial benefits from this decision at the expense of smaller rivals.
It would be good to understand the Bank's position on the above points, as I would like to know whether or not they have been considered and the importance given to each in the process.
CEO, Cash Management Solutions
If you would like to speak to CMS about any of these issues raised, please contact Matthew Shaw, Head of Marketing on +44 (0)1925 412 904 or firstname.lastname@example.org.