Banknotes of The Pound Sterling - Everyday Use and Acceptance

Everyday Use and Acceptance

The wide variety of sterling notes in circulation means that acceptance of different pound sterling banknotes varies. Their acceptance may depend on the experience and understanding of individual retailers, and it is important to understand the idea of "legal tender", which is often misunderstood (see section below). Misunderstanding that all bills are legitimate and of equal value, and can be accepted by merchants anywhere, has become a tourism headache in some parts of the UK. In summary, the various banknotes are used as follows:

English banknotes (Bank of England)

The majority of sterling notes are printed by the Bank of England. These are legal tender in England and Wales, and are always accepted by traders throughout the UK. Bank of England notes are generally accepted in the Overseas Territories which are at parity with sterling. In Gibraltar, there are examples of pairs of automatic cash dispensers placed together, one stocked with English notes, the other with local ones.

Scottish banknotes

These are the recognised currency in Scotland, but are not legal tender. They are always accepted by traders in Scotland, and are usually accepted in other parts of the United Kingdom. However, some outside Scotland are unfamiliar with the notes and they are sometimes refused. Institutions such as clearing banks, building societies and the Post Office will readily accept Scottish bank notes. Branches of the Scottish note-issuing banks situated in England dispense Bank of England notes and may not dispense their own notes from those branches. Modern Scottish banknotes are denominated in pounds sterling, and are exactly the same value as Bank of England notes; they should not be confused with the former Pound Scots, a separate currency which was abolished in 1707.

Northern Ireland banknotes

Banknotes issued by Northern Ireland banks have the same legal status as Scottish banknotes in that they are promissory notes issued in pounds sterling and may be used for cash transactions anywhere in the United Kingdom. However, they are rarely seen outside Northern Ireland and in England and Wales, although they could be accepted by any store, are often not accepted without some explanation. As with Scottish notes, clearing banks and building societies will accept them. Northern Ireland sterling banknotes should not be confused with the Irish pound (or Punt), the former currency of the Republic of Ireland, which was replaced by the euro in 1999.

Banknotes from the Crown dependencies

The Bailiwicks of Jersey and Guernsey, and the Isle of Man are possessions of the Crown but are outside the UK; they are in currency union with the United Kingdom and issue sterling banknotes in local designs (Jersey and Guernsey pounds are freely interchangeable within the Channel Islands). In the United Kingdom, although they could be accepted by any store, are often not accepted without some explanation. However, they are accepted by banks and post offices and can exchange these notes for other sterling banknotes.

British Overseas Territories

There are fourteen British Overseas Territories many of which issue their own currencies which are distinct under ISO 4217; Gibraltar, Saint Helena and the Falkland Islands have their own pounds which are at par with Sterling. These notes cannot be used in the UK or outside the territories of origin. Falkland Island Pounds are also commonly used in the South Georgia and the South Sandwich Islands and the British Antarctic Territory. St Helena pounds can also be used on Ascension Island.