Banknotes Banknote Collecting: The Ibns Introduction To The Ibns Introduc

THE IBNS INTRODUC
INTRODUCTION TO
BANKNOTES
& BANKNOTE
COLLECTING
Prepared by members of the International Bank Note Society.

© 2018 The International Bank Note Society.
www.theIBNS.org
Table of Contents
Introduction 3
The Banknote 4
What is a Banknote? 4
Other Paper Instruments 6
What is Legal Tender? 9
Features of a Banknote 10
Why are Banknotes Interesting? 13
How is a Banknote Manufactured? 15
Essays, Trials, Proofs and Specimens 22
Collecting Banknotes 23
Catalogues 23
Types and Varieties 24
Grading Banknotes 26
Forgeries 30
What to Collect? 31
How to Build a Collection 32
What Condition to Buy 32
Third-Party Grading 33
Processed Notes 33
Collectors and Investors 34
How to Store a Collection 34
The Equipment a Collector should Own 35
Disposing of your Collection 36
Join the IBNS 36
2 The IBNS Introduction to Banknotes & Banknote Collecting

Introduction
T his guide is an introduction for people pursuing an interest in

banknotes and gives the beginner a description of the banknote, its
various features and how banknotes are manufactured. Included in this
guide is an outline of aspects to be considered when building a collection
of banknotes.
While there are many numismatic organizations throughout the world,
the International Bank Note Society (IBNS) is the premier organization
for people interested in banknotes of the world. Membership of the
Society includes collectors, banknote dealers, auction houses, libraries,
numismatic publishers and institutions. Membership in the IBNS has
numerous benefits, principally bringing together people with a common
interest in banknotes. One of the main benefits of membership is receiving
the quarterly IBNS Journal—a full colour, 80-page magazine with articles
on banknotes and covering aspects of the Society’s activities. A web
site at www.theIBNS.org offers information on banknotes, the Society’s
activities and the Society’s members. A forum on the website is available
for members to discuss matters and ask questions. The IBNS Directory
lists all members of the Society, usually with their contact details and their
collecting interests; with the Directory distributed to all members. Two
annual postal bid auctions are also available for members to sell and buy
banknotes. To gain the most from an interest in banknotes, membership
of the IBNS is recommended.
Once a collection has commenced, the new collector will find answers
to further questions by contacting fellow collectors, reading specialist
publications, or obtaining general publications on banks and banknotes.
Reference to this guide may also prompt collectors to find out a little more
about the banknotes they already possess. We certainly hope your interest
in banknotes continues for many years.
The IBNS Introduction to Banknotes & Banknote Collecting 3

What is a
Banknote?
T oday, the term “banknote” or “bank note” is used to

generally describe paper money issued by various authorities
around the world, but banknotes are not always issued by banks.
The Banknote
“Paper money” is another term commonly used to describe banknotes, as

this term does not limit items to articles issued by banks, but it also includes
items that are not made of paper. In some countries “currency” refers to
paper money, but this term usually refers to officially issued notes. (Another
definition of “currency” is “That which is current as a medium of exchange;
the circulating medium (whether coins or notes); the money of a country
in actual use.” Oxford English Dictionary (OED)) So, despite perceived
inaccuracies, the term “banknote” is commonly used to refer to paper money
in its various forms.
In most countries banknotes are issued by a central bank, supervised by the
government. In some places, banknotes are not issued by a bank, but are
issued directly by the government, such as in the British dependencies St.
Helena and the Falkland Islands. Similarly, in some countries, banknotes have
been issued by the treasury of a government and not by a central bank, but
they are nevertheless still regarded as banknotes.
Originally, banknotes were issued by private banks and governments issued
only coins. There remain several places in the world where private banks
continue to issue banknotes for general circulation, rather than be issued
by the government—this still occurs in Hong Kong, Scotland and Northern
Ireland.
The earliest banknotes were one of a number of paper money instruments
used by individuals and companies to engage in transactions, all of which
represented a promise to pay a certain amount of money specified on the
banknote, at a certain point in time, and some of which were made payable to
the bearer (the person holding the paper money) and some that were payable
to a particular person.
A modern banknote from Ethiopia, issued by a central bank—the National Bank of Ethiopia.

This banknote, a post note, was issued by a private company and was payable to an individual, (or order) after a specified period, in this case
after 45 days. It was not payable “on demand” as is the case with most banknotes.
The particular features of a banknote,

over other types of paper money, is it
was usually payable to the bearer and
usually payable on demand. Originally,
a banknote was “A promissory note
given by a banker, payable at a fixed
date to a specified payee.” (OED)
Later, a banknote became “A piece of
paper money of a fixed denomination,
circulating as currency.” (OED)
While most types of banknotes now The Royal Bank of Scotland is one of three private banks to issue banknotes
have all details printed during their in Scotland. Although authorized to circulate, the notes issued by the Scottish
manufacture, originally they were banks are not legal tender.
handwritten, and then partially printed
as “forms” to be completed by hand
at the time of issue. The items to be
completed varied, but usually consisted
of the date, the serial number and the
signatures. Banknote forms that are not
completed are known as “remainders”
and modern banknotes that have never
been issued can also be referred to as
remainders.
Above: This banknote was prepared for the state of Biafra,

which seceded from Nigeria in the late 1960s. This note has
no serial numbers, was never issued, and is thus regarded as
a “remainder.” Typically, modern banknotes without serial
numbers, or signatures, and sometimes the date – items
often added after the printing of the note – are considered
remainders.
Left: This is a privately issued note for seven shillings.

The form was prepared for the Ballindalloch Cotton Works,
and promised to pay one guinea (21 shillings) if three of
the notes were presented. Most of the form is printed, but
several areas of the form had to be completed by hand—the
date, the serial number, the signature and the name of the
clerk who entered the note into a register.

Other Paper
Instruments
A hand-written bill from Scotland,

dated 1757. O ther types of financial
instruments associated with
paper money are:
Note (or Note of hand): A written
promise to pay a certain sum at a
specified time. (OED)
Bill (or Bill of Exchange): A written Bank post bill: Originally a
order by the writer or “drawer” to promissory note intended to be
the “drawee” (the person to whom conveyed to its recipient by mail, but
it is addressed) to pay a certain sum later used as post-dated bills, or post
on a given date to the “drawee” or notes, and were payable at a future
to a third person named in the bill, date; i.e. post dated.
known as the “payee”. (OED)
A Bank Post Bill issued by Beresford’s Bank, Ireland.

Cheque (check): A written order
(on a printed form or otherwise) to
a banker by a person having money
in the banker’s hands, directing him
to pay, on presentation, to bearer or
to a person named the sum of money
stated therein. (OED)
Letter of credit: A letter or
document, especially one issued by a
bank or other financial organization,
authorizing a named person to
draw money to a specified amount
from the issuer’s agents or business
associates in another place. (OED)
Circular note: A letter of credit
addressed by a banker (e.g. in
London) to several bankers in other
countries, in favour of a certain
person named therein, usually a
person on a tour.
Above: A specimen letter of credit issued by

“Skiensfjordens Kreditbank” in Norway, for
the provisioning of a ship.
Left: A cheque drawn on the Cairo branch

of Barclays Bank (Dominion, Colonial and
Overseas).
Left: A specimen Circular Note

(Billet de Change Circulaire) prepared for
The City Bank, Limited, London.

Travellers Cheque: A cheque for Bearer Security: An unregistered Private Issues: While most
one of several specified amounts security the title to which is vested banknotes are official issues, by a
of money, that can be cashed at a in its possessor and is transferred government or by a central bank,
bank in most countries, or used in by simple delivery. So bearer bond, there are many private banknote
payment for goods, on the holder’s bearer stock, bearer warrant. (OED) issues. Some of these were issued
endorsement against his original by owners of factories or by store
signature. (OED) merchants, but there have famously
been individuals who have attempted
to issue their own banknotes.
Fantasy Issues: Because of the
general interest in banknotes, it
is now common for people and
companies to produce banknotes
which have no value, but which
imitate banknotes. Some of these are
very professionally manufactured
and some are poorly produced.
Notgeld: Also described as
“emergency money”, “local
currency,” “token money” or
A specimen travellers cheque for two pounds, issued by the District Bank,
“necessity money”. Notgeld is
Manchester, England.
typically issued during and after
wars and economic upheavals,
due to the lack of sufficient official
currency, or high inflation, or the
disappearance of coinage. Notgeld
has been issued by local town
authorities, municipalities, chambers
of commerce, goldsmiths, militias,
railroads, charitable organizations,
asylums, factories, stores, co-
operatives, corporations, private
banks, occupying military forces,
and others. Most Notgeld served as
“small change” to replace coinage,
A private note issued by the Chief Treasury of Wales, established by eccentric Welshman, which tends to disappear in times of
Richard Williams.
financial crisis; but occasionally it
served as the primary currency.
Scrip: A substitute for legal tender,
issued for limited circulation.
Issue might occur in a closed
environment, such as on a ship,
a “company town” or in a mining
camp. Scrip can also be a substitute
for legal tender when none is
available; issued by companies that
run out of cash, or by governments
during a budget impasse.
A fantasy issue for the Chatham Islands. This is one of several issues which were ultimately
banned by the government of New Zealand because they purported to be legal tender on the
Islands, which they were not.

What is Legal The status of a banknote
generally goes through
Tender? three phases:
T
1. Banknotes become legal
hese days, most officially issued banknotes in a country are considered tender on being issued.
legal tender. Under the laws of a country the circulating banknotes and
coins are usually declared to be legal tender for all debts, both public and 2. Once the banknote is no
private. This means people must accept the banknotes and coins in payment longer in use, generally
for goods and services. Public debts are those incurred by the government because a new issue of
and its agencies, and private debts are between individuals or companies. banknotes replaces an
In the law declaring legal tender, restrictions may be imposed. Often, small earlier issue, they lose
denomination coins and banknotes are declared legal tender up to a certain their legal tender status.
amount; for example, a 1-cent coin might be legal tender up to 1 dollar—
These banknotes can
meaning if someone wants to pay a 2-dollar debt with more than 100 1-cent
be redeemed at banks
coins, the person receiving the payment is not legally obliged to accept the
for the new legal tender
payment. Laws on legal tender vary from country to country and in times
banknotes, and sometimes,
of emergency, particularly during war time or during the conversion of a
currency, there may be more than one currency declared legal tender in a often for a period of
country or territory. many years, they can be
redeemed at the central
bank that issued the
banknotes.
3. The banknotes are

demonetized. This means
they completely lose their
value and can no longer
be redeemed anywhere.
Although not commonly used, declarations of legal tender appear on banknotes from This usually happens
the USA (above) and Australia (below).
after many years, but
sometimes it happens
quickly, especially if there
is a civil war or if there has
been widespread forgery
of the note issue. In some
countries, the banknotes
are never demonetized and
their value can always be
redeemed by the issuing
authority.

Features of a
Banknote
The banknotes of the Bahrain Currency
B
Board used Arabic text on the front of the
note and English text on the back of the note. anknotes have a front and Banknotes throughout the world
a back. Various terms have common features, although
are used to refer to the front not every banknote has each of the
following features.
and back of a banknote, with
no terms being universally Name of the issuing authority:
The name of the issuing authority,
recognized; the front is also
usually the central bank of a country,
known as the obverse or face, generally appears at the top on the
and the back is also known front of the note. Sometimes the
as the reverse. While older name is also on the back of the note,
banknotes were uniface, having frequently in English if the name of
only a printed front and a blank the issuing authority is not rendered
Although the banknotes of many countries back, all modern banknotes are in English on the front.
have the name of the issuing authority in
two languages, Switzerland (see above) uses printed on the front and the Denomination: The denomination
its four national languages on its notes (two back. of the note is always on the note,
on the front and two on the back): German, almost universally in numerals and
Romansh, French and Italian.
often written in text. Where more
than one language is used in the
areas where the note circulates, the
denomination is often presented
in multiple styles of numerals and
sometimes in multiple languages.
Promise to pay: When banknotes
were first issued, there was usually a
phrase written on the banknote with
a promise to pay the bearer the value
of the note on demand. This was at a
time when banknotes were backed by
coins, usually made of silver or gold.
For many years, banknotes have no
longer been backed by coins and are
now regarded as “fiat money,” that is,
the value of the note is decreed by law,
and the promise to pay does not exist
Banknotes in Cambodia declare their denomination in Khmer numerals and western numerals. on most modern banknotes.
Date of issue: Frequently a date of
issue is included on the banknote,
but many modern issues do not
include a date. Sometimes the date
of issue is a complete date—with day,
month and year—and sometimes
just the year. In some countries the
date is given according to more than
one calendar, such as in Muslim
countries where the Hejira calendar
In the 1960s and 70s Pakistan used Bengali, Arabic and Western Numerals on its banknotes. is used. Sometimes the date is
hidden in the serial number.

Date of law authorizing issue: The signature, and often two. Modern Although not commonly used on modern
law authorizing the issue of the banknotes usually have one or two banknotes, the promise to pay the bearer
on demand was usually found on older
banknote is occasionally referred signatures, although throughout banknotes, such as the note from Sierra
to on the banknote and this often history as many as 14 signatures Leone (above). The promise still exists on
includes the date of the law. This date have appeared on a banknote. some modern banknotes, as on the note
from Guernsey (below).
should not be confused with the date Typically, the signature of the head
of issue. of the issuing authority appears
Series number: In numbering on the banknote, but the title of
banknotes, a series number is often the signatories varies greatly, from
assigned, usually in a one- or two- a member of the staff of a bank,
character format using either letters such as the Chief Cashier on the
or numerals, or a mix of letters banknotes issued by the Bank of
and numbers. In some cases serial England, to the leader of the country
numbers are not used on banknotes, issuing the banknote, such as the
with only a series number used. This President on the banknotes issued
usually occurs in emergency issues in the Philippines and the sultans
or on notes with very little value. of Oman and Brunei who sign the
notes issued in their countries.
Serial numbers: Banknotes have
carried serial numbers since Illustrations: The earliest banknotes
banknotes were first used. The carried no illustrations, but from
serial numbers originally allowed early times vignettes began to appear
staff in the bank to match an issued on banknotes. Over time, the size
note against a counterfoil from of the vignettes grew to become a
which the note was cut, or match dominant feature of a banknote.
the note against a ledger in which Now, illustrations commonly
issued notes were recorded— appear on the back of banknotes
allowing verification of the note’s as well as on the front. The subject Above: Examples of dates depicted on
issue. Today, banknotes almost of the illustrations often tells much banknotes: (top) day, month and year on
about the history and culture of the a banknote from Brunei, (centre) month
universally carry one serial number and year on a banknote from Angola,
and usually a repetition of the serial country in which the banknotes are and (bottom) year only on a banknote
number; although banknotes have issued. from Norway.
been known to repeat up to six
serial numbers. Sometimes serial
numbers are presented in more
than one character set; and if this is
done, it is usually once with a Latin On this banknote from Bahamas, the series The year in two calendars – Gregorian and
is identified by a year. Hejeira – appears in Arabic numerals on
character set and once with a non- banknotes issued in Oman.
Latin character set, such as Arabic,
Bengali, Hebrew, Urdu, et cetera. In
modern banknotes it is common to
find non-Latin character sets used
for all repetitions of a serial number.
On the note from Russia the series number The date of the law authorizing the issue of
Signatures: Banknotes, from their is two letters and a number, and there is no the note; on a banknote from Bolivia.
serial number.
inception, usually carried at least one

Security features: The earliest
banknotes carried very few security
features, but today there are many
types of security features, all
designed to make counterfeiting of
banknotes more difficult. See the
The official most likely to sign a banknote is the governor of the central bank, as seen in the “Security Features” section for more
image at top left from a banknote issued in Barbados. The signature at the top right is of the details.
Sultan of Brunei, the head of state, on a banknote issued in Brunei.
The banknote issued by Guinea-Bissau (below) was first issued with three signatories, but was Warning to counterfeiters: On
soon re-issued with the titles, and signatures, of two signatories changing. (The font for the some banknotes, a warning to
serial number also changes.) counterfeiters is included. It is a
short section of text, sometimes
referring to a law and sometimes
stating the penalty for counterfeiting.
Occasionally a banknote will carry
the copyright symbol (©) and
who is claiming copyright. This is
not specifically aimed at forgers,
although copying the note adds
to their crime, but is aimed at
protecting the design from being
used on souvenir items such as tea
towels and mugs.
Above: A vignette from an Australian Bank Post Bill, typical of

nineteenth century vignettes.
Above: The claim to copyright on a German banknote.
Warnings to counterfeiters on banknotes from Haiti (top)

and Germany.

This image, after a painting by John Trumbull, shows the presentation of the United States of
America’s declaration of independence by its drafters, a famous historical event, depicted on a
banknote issued in the United States of America.
Why are
Banknotes
Interesting?
T here are many reasons why banknotes are interesting and

each person may develop an interest in banknotes for a
different reason. Some of the common reasons banknotes are of
interest are listed here.
A Record of Culture: The banknotes of many countries carry images relating
to the culture of the country of issue. For example, an issue of notes might
carry the fauna and flora of the nation; the notes might display portraits of
famous people; and important monuments or buildings may be depicted.
By understanding why these images are used, much is learnt of the country
of issue.
The banknotes of Iraq are a good example of

being able to follow its modern history. From
the top, we have a Currency Board issue with
King Faisal I; then a World War II emergency
issue with King Faisal II; a National Bank
issue; a Central Bank issue follwing the
formation of the republic; a modern Central
The back of this two-dollar note from Belize shows the “Mayan Ruins of Belize” and Mayan Bank issue; an emergency issue, depicting
patterns are incorporated in the design of the note, all depicting the important cultural Saddam Hussein, following the First Gulf
heritage of the nation. Additionally, the native flora and fauna of Belize are depicted in a War; and a note issued by the Central Bank
panel towards the left. Thus aspects of the country’s culture are portrayed on the banknote. following the overthrow of Saddam Hussein.

A Record of History: While The Beauty of a Banknote:
aspects of a nation’s history might Banknotes are frequently small
be depicted on a banknote, such works of art. Some people collect
as famous battles, famous treaties, banknotes just because they are
and famous events, it is more often beautiful items, highlighting the
the change in the banknotes over skills of the artists and engravers
a course of time that portrays who created the work. Some people
aspects of a country’s history. For assemble a banknote collection
example, a colony may develop into based on the engraver who created
a nation, and then undergo political the artwork on a banknote.
upheavals, sometimes leading Themes: Many people collect
to a new nation or a short-lived banknotes along a particular theme,
secession. These events can be seen such as butterflies on banknotes or
in the banknotes, reflecting the bridges on banknotes. Others might
changes in the country. Sometimes collect banknotes with musical
an issue of banknotes causes themes or animal themes. Some
controversy itself, or specific events people collect banknotes of countries
are linked to an issue of banknotes, that no longer exist and some collect
and the story behind these issues or banknotes used by occupying
events can be more interesting and armies. There are many themes from
exciting than any book or movie. which to choose and each can be a
source of interest to the collector.
Beauty is in the eye of the beholder, but above are some banknotes
which are works of art in their own right—from Estonia, Algeria and
The Bahamas. The third banknote could also be a target of people Some collecting themes are: Queen Elizabeth II on banknotes (top),
who collect fish depicted on banknotes. scientists on banknotes (middle), and castles on banknotes.

How is a Banknote
Manufactured?
T here are two basic processes to manufacturing a banknote:

the manufacture of the banknote material and the printing
of the material.
The Banknote Material

Banknotes have historically been
made of paper, but the manufacture
of the paper has varied over the
centuries. The earliest known
banknotes are Chinese banknotes
that were printed on paper
manufactured from the bark of
mulberry trees—which made grey
or purple paper. In the western
world, paper was made from
cotton or flax, or a mixture of these
fibres. The paper was thus of high
quality, enabling the banknotes to
circulate for a long period without
deteriorating. Paper manufactured
from timber pulp is not as strong or
as durable as paper manufactured A banknote manufactured from silk; issued in the Khorezmian People’s Soviet Republic in
from cotton and flax, but it has been 1920.
used for banknotes—usually for
emergency issues.
In recent years banknotes have been
made from plastic. The first plastic
banknotes were manufactured of
Bradvek™ by Bradbury Wilkinson
and Company, utilizing a product
usually sold as Tyvek™. A polymer
substrate developed for Note
Printing Australia is now used by
many note issuing authorities.
Banknotes have also been
manufactured from other materials,
such as silk, but these are considered
oddities and such materials have not
generally been used.
Notgeld (emergency money) issued by the Lautawerk factory in Lauta (Germany),
manufactured from aluminium foil.

Printing Lithographic printing was developed
in 1796 and originally used a type of
Printing on banknotes mostly follows
stone as the printing surface; this was
one of three principal methods, but
etched to generate the area holding
usually a mix of these methods is
the water. Modern lithography
used. The three printing methods are:
uses a polymer coating applied to a
relief, lithography, and intaglio.
metal or plastic surface and only the
Relief printing: The text or image to polymer surface holds the ink to be
be printed is created as a raised area printed.
that is inked and applied to the paper.
Offset printing transfers (or offsets)
This type of printing was used in
the image from a printing plate to
many ways by the printing industry
a rubber roller that then applies
over many centuries. Block printing,
the ink to the paper. In modern
letterpress and stereotype printing are
printing, one or more printing plates
A diagram illustrating the offset printing all types of relief printing. Banknotes
are commonly prepared to use the
process. (Courtesy Wikimedia Commons.) have infrequently used this style
lithographic process. Most modern
of printing but the early Chinese
banknotes use the lithographic
banknotes and the banknotes of Tibet
and offset processes to print the
were printed using relief printing.
background of the banknote and
Serial numbers, however, have sometimes these processes are used
almost universally been printed on to manufacture the entire banknote.
banknotes by relief printing. Intaglio printing: The image to be
Lithography and Offset: Using applied to the paper is etched onto a
lithography, the printing surface or metal plate that then has ink applied
A banknote for 3 taels, issued by the Khotan printing plate is treated to create to it before it is wiped clean. After
District Administration in China around being wiped clean, the ink remains
1935–36. It is block printed, which is a type of two textures, one that absorbs water
relief printing. and one that holds the oil-based ink. in the etched areas and when paper
When the ink is applied to the whole is applied to the printing plate under
Below left: Detail of a 500-franc note of the printing surface, the areas that hold high pressure the ink is transferred
Comoros, manufactured with intaglio printing. to the paper.
the water repel the ink and only the
Below right: The same note was later issued
with lithographic printing. surface that holds the ink transfers an The etching is achieved in one of two
Note the flat colour. image to the paper. ways and sometimes a combination
of these methods is used.

The first method is to use tools to colours to be printed in one pass of Varieties of security thread
engrave the design directly onto the the printing press.
printing plate. The second method
sees the printing plate covered in Security Features
a “ground” and the designer then Because of the problem of forgery
draws the design in the ground. A typical windowed or segmented security
over many years, much attention thread.
The plate is subjected to acid, which has been given to security features
etches the plate where the ground that impede the successful imitation
has been removed. of banknotes. The security required
The intaglio method was generally for banknotes, along with share
A wide windowed security thread
used from the introduction of certificates, bonds and passports, with micro-printing.
banknotes in the late 17th century has led to companies specializing in
and remains in use today. However, security printing and, as technology
the methods of utilizing this process develops over the years, there have
have developed significantly over been increased and innovative Detail of a security thread using the
the years. Many modern banknotes features added to banknotes to deter MOTION technology.
use intaglio printing for the counterfeiting attempts. While there
principal design elements, with are specific security features that
lithographic and offset printing for can be clearly identified, there are
the background. many aspects of security not always
Detail of a RollingStar® security thread,
apparent; these include the colour developed by Louisenthal.
N.B. Sometimes a banknote is
and features of the ink—including
printed with its background using
ink that can hold a magnetic
lithographic and offset printing
field and inks that fluoresce—
methods and the principal design
and patterns used on banknote
features use intaglio printing. Then
designs—that cause photocopies of Detail of the RollingStar® Cube security
a later issue of the banknote is made thread, developed by Louisenthal.
banknotes to be rendered useless and
by using only lithographic and offset
software packages that do not allow
printing. Therefore collectors need
printing of scanned images. In older
to know the difference between the
banknotes, sometimes intentional
type of printing on the banknotes. Micro printing of “Bangladesh Bank” on an
mistakes were made so the errors otherwise clear security thread.
• Lithographic and offset printing looked like poor printing, so when
renders sharp borders and edges on the features were perfectly rendered
a printed line or a printed shape in a forgery, they could be identified.
• Intaglio printing shows, under Each year new security devices are
magnification, lines and edges to added to banknotes throughout the
be “furry.” Additionally, intaglio world, as security printers attempt
printing usually has a gloss finish, to introduce a feature that gives
as opposed to the dull finish to them a marketing advantage. Details
lithographic and offset printing. or summaries of these features are
commonly published on the Internet
Colour and for people interested in security
Most early banknotes were printed features, there is an amazing array
in black ink and in only one of features to discover. Although
colour. Two-colour printing was not comprehensive, the following
introduced in the 1820s, by using security features are identified,
multiple printing processes, and particularly as changes to these
the complexity of colour printing items can determine a variety of a
progressed over the years. Modern banknote.
printing techniques allow multiple

Security fibres: Banknotes can have
coloured fibres embedded in their
paper, introduced at the time of paper
manufacture. The fibres are either
evenly spread over the paper or they
are formed in a strip at a certain
section of the paper. Frequently
these coloured fibres fluoresce under
ultraviolet light. Variations on the
inclusion of coloured fibres in the
paper, are the inclusion of small
coloured strips with writing on them
or planchettes—small metal, plastic or
paper discs—embedded in the paper.
Security threads: This is perhaps the
most wide spread of modern security
features and a feature that has been
adeptly modified over many years.
Initially, the security thread was a
simple metal thread embedded in
the paper and was, to some extent, a
modification of embedded security
Above: A traditional watermark and an Watermark: Watermarks were used fibres. From this simple thread, we
electrotype watermark (partially covered by in paper manufacture long before now see threads that appear to weave
the serial number) on an Italian banknote. in and out of the paper, threads
(A perfect registration device of stylized the issue of the first banknotes. The
watermark is introduced during the with micro-printing on them, thin
leaves is at the lower left.)
threads, wide threads, threads
manufacture of the paper and was
with iridescent effects, and threads
originally produced by raised images
that have optical effects showing
in the paper moulds that impressed
movement of images.
the image of the watermark into the Embossing: The traditional security
paper, affecting the moisture levels in feature of using a blind stamp for
the paper during the drying process. embossing paper is now largely out
Watermarks with shadows are of use, although it is occasionally
achieved by distorting the screen on found in modern banknotes. Tactile
Detail from an Argentinian banknote showing
(above) colour fibres embedded in the which the paper pulp is laid, creating features are now being embossed on
banknote and (below) the same detail when different thicknesses of paper that banknotes to assist sight-impaired
the note is submitted to ultraviolet light. dry unevenly. Early watermarks for people, but this is not intended as a
banknotes were specifically designed security feature.
to suit individual notes. This practice
is still wide spread, but with the
use of sheets of paper to print
banknotes, watermarks can be evenly
distributed over the entire sheet,
or by producing a continuous (or
banded) watermark. Watermarks are
usually, but not universally, found
in a white or lightly coloured area of
the banknote.
Electrotype watermark: Similar to a
traditional watermark, but the image
is created by a flat metal device, or
wires, spot welded to the screen on Embossing (front and back) on an Iraqi
banknote. Embossing was used on many early
Planchettes embedded in a Canadian banknote. which the paper is laid. banknotes and sometimes to affix a duty stamp.

Serial numbers: Although necessary
for practical purposes, serial numbers
have commonly been used as a
security device by: using fonts not
available to the public, printing serial
numbers vertically and horizontally,
printing the characters in ascending
sizes, printing the numbers in
different character sets, printing Perfect registration device: Because Above: Three images showing a perfect
them with fluorescing inks, and even modern banknotes are printed on registration device on a 5-afghani banknote
printing a single serial number in from Afghanistan. The first image shows the
the front and back at the same time, printing on the front, the second shows the
different colours. images on the front and back can image on the back, and the third shows an
be perfectly aligned, or perfectly Arabic 5 when the images are combined by
holding the note to the light.
registered. This allows a partial
image to be printed on the front of
the note and a partial image on the
back, and when the banknote is held
to the light the two partial images
form a single crisp image.
Fluorescent devices: The use of
fluorescent inks is widespread in
modern banknotes. Commonly
used for coloured inks and in serial
numbers that fluoresce under ultra-
violet light, there are often devices
printed on the banknote that are not
apparent in normal light, but that
become apparent when submitted to
ultraviolet light. Detail of a Danish 1000-kroner viewed in
Micro-printing: To the naked eye normal light (above) and the same detail
when submitted to ultraviolet light (below);
micro-printing looks like a line where a fluorescent device of a man on a
or a pattern on the banknote, but horse becomes apparent, as well the serial
when magnified it can be clearly number and signatures fluorescing.
read. Most attempts to photocopy or
photograph the note will not succeed
in copying the micro-printing with
the necessary clarity. Micro-printing
is almost exclusively executed with
intaglio printing. While micro-
Sample variations in serial numbers, showing printing usually appears with the
(from the top): the serial number in two
character sets; each serial number in different words printed in intaglio ink, it also
colours; one serial number printed in two appears where the background is the
colours; a serial number where two colours intaglio ink and the micro-printing
are used, but the colours are spread across
the numerals; Arabic prefix and numerals; is the absence of ink.
Arabic prefix with western numerals; Bengali Commonly, micro-printing consists
prefix and numerals; Bengali prefix and
western numerals; a serial number with no of a word or phrase repeated many
apparent prefix; two letters in the prefix; three times, but sometimes it is a length of
letters in the prefix, a fractional prefix; two text, such as a poem.
vertical serial numbers; a letter as a prefix and
numerals in ascending size; a letter as a suffix, Latent images: These are used in
with the numerals in ascending size; and a banknotes where intaglio printing
serial number with the date embedded, that is,
the first two numerals “17”identify the date of is used. Within a pattern of intaglio
manufacture: 2017. printing is an image, commonly the

Above: Micro printing on a 10-euro note,
showing three lines of EURO in Latin and
Greek characters. In the top left and top
right of the image the number “10” is formed
repeatedly by the absence of ink.
The latent image (above) of “100” (in Bengali numerals), shows how the image is created by
Left: Detail from a Brazilian 10-reais note, lines of intaglio ink being printed in two directions. Below is a latent image of “BNA” from a
showing the use of SPARK Origin™ colour- banknote issued by the Banco Nacional de Angola.
shifting ink.
Right: Detail from an Australian 5-dollar
note showing the rolling colour effect.
denomination as numerals or the intaglio ink. Devices printed on

initials of the name of the bank, that banknotes continue to improve,
can be seen only if the banknote is such as the introduction of reflective
turned and viewed at a low angle, images that can display two images,
across the note. depending on the angle the device is
Under magnification, lines at the viewed.
vertical and horizontal can be seen Colour-shifting Inks: Many devices
to form the latent image. On some on modern banknotes contain
high-denomination notes, a double colour-shifting inks. SPARK™
The EURion Constellation of small circles is latent image is used, so when viewed technologies are one of the pre-
recognized by modern devices to inhibit or from one angle an image appears, eminent colour-shifting technologies
limit the copying of a banknotes.
but at a different angle another image used on banknotes.
appears. Anti-reproduction patterns:
To counter the advantage of See-through panels: The Because it is so easy to scan the
a clear window on polymer
notes, manufacturers introduction of polymer banknotes image of a banknote, then print it,
of paper notes created saw the innovation of clear windows, technology companies have co-
banknote paper with holes which has been copied in paper operated with security printers in
in them, then covered them
with plastic strips, creating a banknotes by the application of clear recognizing patterns on banknotes
clear window. These became strips of a plastic over holes in the which allow copying devices (such
known as “hybrid” notes, banknotes. as photocopiers) and software (such
as seen on this detail in a
banknote from Bermuda. Variable devices: Many high- as scanning programs) to reject or
denomination notes carry a foil limit options in images being copied.
device that has peculiar features. The most common pattern used to
These range from an incised foil identify a banknote is the EURion
swatch which reflects an iridescent Constellation of small circles (also
light, to holograms with images called Omron rings).
showing depth. There are also inks In conclusion, this overview of
that change colour when viewed security features, although limited
from different angles and these in its scope, shows the continued
are usually printed as a swatch of development of security features

and, for the collector, highlights the
need to be able to identify changes in
security features to identify different
varieties of banknotes. Perhaps
unsurprisingly, while catalogues will
differentiate varieties according to
changes in some security devices,
others are not recorded. For
example, there are few varieties of
banknotes defined by the change in
fluorescent features on a banknote.
So a collector should always take
time to investigate the features
of a banknote as there are many
uncatalogued varieties in some areas
A KinegramTM from a German 200-mark note.
of collecting.
Above: A holographic patch on an

Albanian note.
Right: An incised foil strip with variable
images on a note from Botswana.
Far right: A series of variable devices in
a transparent window on a note from
Australia.

Essays, Trials, Proofs
and Specimens
D uring the design and
production processes of
manufacturing a banknote, several
Proofs are generated for the approval
of the issuing authority.
Specimen notes are usually the final
artefacts can be generated, before the
design, overprinted for distribution
circulating banknote is produced.
to banks and institutions to show
An essay (“essai”) or trial is any what a new banknote looks like.
piece generated during the design Specimen notes are also produced as
phase, leading to the final banknote. presentation pieces.
When compared to the final
Facsimile notes (sometimes called
banknote, there might be significant
“pulls”) are items printed from the
variation and the essay may bear no
original printing plates, or copies
resemblance to the final issue.
using modern technology, usually
Colour trials typically have the final produced many years after the
design, but varying colours. These original notes were issued.
are generated to show the issuing
authority possible colour choices.
The three Bank of Scotland notes illustrated above show the issued note (top left), a colour
trial with the blue and brown colours reversed (top right), and a similar colour trial with blue
margins (bottom left). The Bank sought the colour trials in the early 1960s due to criticism in
identifying the reduced-size banknotes they had issued.
Bottom right: An essay or trial piece prepared for Ethiopia. This design was never adopted.

Catalogues
Collecting Banknotes
W henever a collector
contemplates starting a
collection, acquiring a catalogue
some address one country, some
address old issues, and some address
a theme, such as banknote errors or
specific to one’s collecting interest replacement notes. (Replacement
is highly recommended – dare notes are banknotes that are
we say essential! There are many inserted into bundles of notes to
catalogues describing and recording replace banknotes damaged during
banknotes, usually ascribing a production; ensuring the first and
numbering system to the notes last serial numbers in a bundle of
and giving estimated values for banknotes indicate a sequential 100
the notes in one or more grades of banknotes. Replacement notes are
condition. Catalogues are available usually identified by special serial
that cover the world of banknotes, numbers.)
The serial number of a replacement note from

New Zealand, identified by the asterisk.
A serial number from a replacement note

issued in Botswana. Prefixes on replacement
notes commonly use “Z” or an asterisk.

Types and
Varieties
B anknotes are usually catalogued

by types and varieties, and
these are the way in which banknotes
Types
Type banknotes are generally
determined by the design of the
are sold and collected. Not every banknote, taking into account the
collector wants to collect every principal features of a banknote. The
variety, but for someone who features that generally determine a
specializes in a series of banknotes, type are:
the aim is usually to collect every
variety. A “type” note is a specific • The denomination
design for which there may be several • A new design
varieties. Usually the differences • A change in issuing authority
between types and varieties are • The name of the currency unit
straightforward, but occasionally
• Size of the note
one source will designate a banknote
a “type” while another source will • A major change of colours
designate it a “variety.” As long
as collectors can determine the
differences to their own satisfaction,
they can collect the banknotes as
they wish.
The banknote above was issued by Pakistan

prior to the civil war, which led to East
Pakistan becoming Bangladesh; while the
note below was issued after the civil war.
Only the colour changed, making a new
“type” of the note.

Varieties
Varieties are usually determined by
the following features:
• Minor adjustment to the design
• With and without the name of a
designer or engraver
• A change of printer
• A note with or without the
printer’s imprint; the printer’s
imprint being the name of the
printer, which was commonly
printed in the lower margin (front The Algerian note above was initially issued with a windowed (segmented) security thread;
or back) on older banknotes and then reissued with a foil strip, causing two varieties of the banknote.
is occasionally found on modern
banknotes.
• A change in the printing – usually
from partial lithography and
partial intaglio to all lithography
• A change in signatory
• A change to the title of a signatory
• A change in date
• A change in the style of the serial
numbers
• A change in the serial number
font
• A change to the security features
The backs of these two ten-dollar notes from New Zealand show minor variations to the
• A minor variation to colours colour, with the first (top) note having a blue-green back and the second (lower) note a
predominantly blue back. The front of each note is the same, but the change to the back
While these lists are not exhaustive, creates two “varieties.”
they contain the principal determi-
nants of types and varieties.
The printer’s imprint from four issues of the

Bolivian 20-bolivanos banknote, showing
different imprints (and slight changes
of colour). At top is “TDLR” (Thomas
De La Rue), then “F.C. Oberthur”, then
“CBN” (Canadian Bank Note), and finally
“Oberthur Fiduciaire” (the new name of
the former F.C. Oberthur). Each printer’s
imprint is a “variety” of the banknote.
Three dates used on a 25,000-dinar note from Iraq. The banknotes are identical, except for
the dates which are in the Gregorian and Hejira calendars, from the top, 2010 – 1431, 2008 –
1429, and 2006 – 1427. Each note is a “variety.”

Grading Banknotes
G rading banknotes is important for the collector,

as the grade, the rarity, the face value, and
the demand for a banknote determine its price. A
It is important to understand that the following terms
are grading terms and not absolute terms. Many
collectors misunderstand the term “Uncirculated,”
summary of the International Bank Note Society’s mistakenly believing the term can be used only if
grades for banknotes is listed below, but the full the note has never entered circulation. A bank note
grading standard, with the introduction, can be found can enter circulation and still be in “Uncirculated”
on the Society’s web site. One of the skills a collector condition. As we do not think of a note graded “Good”
must acquire is to grade a banknote correctly. While as a note that is not evil, on the same theme, do not
many people can disagree on the grade of a banknote, confuse the use of the grading term Uncirculated with
collectors must part with their money in the assurance the identification of a note that has never circulated.
they know what they are buying, no matter what grade
a seller has ascribed to a banknote.
Standard International Grading Terminology and Abbreviations
Terms Uncirculated About Uncirculated Extremely Fine Very Fine Fine Very Good Good Fair Poor
Abbreviations UNC AU or aUNC EF or XF VF F VG G Fair PR

UNCIRCULATED ABOUT UNCIRCULATED EXTREMELY FINE
(UNC) (AU or aUNC) (EF or XF)
A perfectly preserved note, never A virtually perfect note, with some A very attractive note, with light
mishandled by the issuing authority, minor handling. May show evidence handling. May have a maximum
a bank teller, the public or a of bank counting folds at a corner of three light folds or one strong
collector. Paper is clean and firm, or one light fold through the centre, crease. Paper is clean and bright
without discoloration. Corners but not both. An AU note cannot be with original sheen. Corners may
are sharp and square, without any creased, a crease being a hard fold show only the slightest evidence of
evidence of rounding. (Rounded that has usually “broken” the surface rounding. There may also be the
corners are often a tell-tale sign of a note. Paper is clean and bright slightest sign of wear where a fold
of a cleaned or “doctored” note.) with original sheen. Corners are not meets the edge.
An uncirculated note will have its rounded.
original natural sheen.
VERY FINE (VF) FINE (F) VERY GOOD (VG)

An attractive note, but with more A note that shows considerable A well-used note, abused but still
evidence of handling and wear. circulation with many folds, intact. Corners may have much
May have a number of folds both creases and wrinkling. Paper is wear and rounding, tiny nicks,
vertically and horizontally. Paper not excessively dirty, but may have tears may extend into the design,
may have minimal dirt, or possible some softness. Edges may show some discoloration may be present,
colour smudging. Paper itself is still much handling with minor tears staining may have occurred, and
relatively crisp and not floppy. There in the border area. Tears may not a small hole may be seen at centre
are no tears into the border area, extend into the design. There will be from excessive folding. Staple and
although the edges do show slight no centre hole because of folding. pinholes are usually present, and
wear. Corners also show wear but Colours are clear but not bright. the note itself is quite limp but NO
not full rounding. A staple hole or two would not be pieces of the note can be missing.
considered unusual wear in a Fine A note in VG condition may still
note. Overall appearance is still on have an overall not-unattractive
the desirable side. appearance.
GOOD (G) FAIR (Fair) POOR (PR)

A well-worn and heavily used note. A totally limp, dirty and very well A “rag” with severe damage because
Normal damage from prolonged used note. Larger pieces may be of wear, staining, pieces missing,
circulation will include strong half torn off or missing, beside graffiti, larger holes. May have tape
multiple folds and creases, stains, the defects mentioned under the holding pieces of the note together.
pinholes, and/or staple holes, dirt, Good category. Tears will be larger, Trimming may have taken place to
discoloration, edge tears, centre obscured portions of the note will be remove rough edges. A Poor note is
hole, rounded corners and an overall bigger. desirable only as a “filler” or when
unattractive appearance. No large such note is the only one known of
pieces of the note may be missing. that particular issue.
Graffiti are commonly seen on notes
in Good condition.

The notes below are appropriately graded, but any graded note has several features which contribute
PAPER NOTES to its grade and the notes below may not have every possible attribute which determines a grade.
For example, a note with a stain will be graded VG, but a VG note might not have a stain.
UNCIRCULATED (UNC) ABOUT UNCIRCULATED EXTREMELY FINE

(AU or aUNC) (EF or XF)

The IBNS Grading Standards were drawn up for paper notes and the attributes they describe
POLYMER NOTES do not suit polymer notes perfectly. The polymer notes below are graded to reflect the IBNS grades
for paper notes.
UNCIRCULATED (UNC) ABOUT UNCIRCULATED EXTREMELY FINE

(AU or aUNC) (EF or XF)
SPECIMEN
SPECIMEN
SPECIMEN
SPECIMEN
SPECIMEN
SPECIMEN
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SPECIMEN
SPECIMEN
SPECIMEN
SPECIMEN
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SPECIMEN
SPECIMEN
SPECIMEN
SPECIMEN
SPECIMEN
SPECIMEN
SPECIMEN
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SPECIMEN
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SPECIMEN
SPECIMEN
The Canadian Banknotes reproduced with the permission of the Bank of Canada.

Forgeries
F rom the time printers
commenced manufacturing
banknotes until the current day,
In the world of today, forgeries
continue to be produced to defraud
issuing authorities, but there are
forgeries have been executed. There now forgeries being produced
is a saying “What one man can make, specifically to fool collectors. Many
Above: A fraudulent inkjet “overprint” (top) another can copy!” To overcome notes with overprints on them are
applied to raise the value of the underlying this, various measures have been being counterfeited by obtaining the
military note. The L extending under the left taken by banknote manufacturers to cheaper original notes and adding
arm of the Y in ONLY could be done only
digitally, not with conventional printing type. make it more difficult for their notes false overprints. Sometimes spurious
to be counterfeited. This has led to overprints are being created and sold
the creation of specialist security as uncatalogued varieties. People
printers. also go to the extent of printing
However, even with specialist notes that look exactly like the
techniques, forgers have continued to original notes, and while they are
ply their trade. The types of forgers sometimes sold as replicas, they are
vary. While it is common to think often bought as originals. This can
of criminal gangs and individuals be done because the technology
creating forgeries, sometimes used to manufacture notes many
governments forge the banknotes years ago has long been superseded
Above: Inkjet printing. Note the stair steps on the by modern technology; and if you
diagonals and curves. Digital processes do not of their enemies—the French under
always handle angles well. Note also the left arm Napoleon forged the banknotes of don’t have an original note against
of the Y extending into the L’s space at right. which a replica can be compared,
Russia, and during World War II the
Below: Genuine (letterpress) printing. No stair a collector may not realize the
steps, and the arm of the Y does not extend into Germans forged the banknotes of
the right side of the photograph. the Bank of England. Some forgeries deception. However, there are people
are done on a small scale, such as who assemble collections of forgeries
creating an individual note, some and it is a recognized collecting
forgers seek to generate a large theme; although collectors should be
amount of banknotes, and sometimes aware it is illegal, in some countries,
security printers have been to possess forged banknotes of any
unwittingly tricked into producing country.
very large orders of banknotes that
are passed to criminal elements.
Genuine note Fraudulent note
Evenly spaced Arabic letters precede the serial number on the A modern fraudulent note printed by a legitimate security printer
genuine note. for a cartel representing itself as an office of the Bahrain government.

Below: A Military Payment Certificate (MPC)
used on the military bases of the United States
What to Collect? of America. This type of banknote is one of
many to stir interest in collectors of banknotes
associated with the military.
T here are more collecting

interests in the world of
banknotes than can possibly be
imagined. Often, it is a specific
theme or interest that attracts a
collector to banknotes in the first
place. For instance, a collector might
become interested in the banknotes
of his own country, or of a country
once visited. This can lead to the
commencement of a collection.
However, when various aspects
of banknotes are investigated and
The possibilities are almost endless;
discovered, a range of collecting start on one subject and you may
interests is opened up. soon find you are collecting two
Some of the common collecting or three subjects, or, on the other
interests of banknote collectors are: hand, becoming a specialist in a very
narrow subject. Some collectors have
• Specific countries said they collect every country of the
• Specific banks world!
• A theme, such as insects on In deciding what to collect, you must
banknotes, or ships, music, also consider your budget. If you
medicine, et cetera have limited funds to spend on your
• Commemorative banknotes, collection, then limit your spending.
However there are still many areas of This error was caused by a fold in the paper,
issued to commemorate specific
collecting that are cheap. Sometimes after the banknote sheets were printed but
events a limited budget means collecting before the serial numbers were printed and
• Inflation money the sheets guillotined. This creates a “flap.”
banknotes in lower grades.
• Military currency
• Banknotes used in military
occupations
• One note from every country in
the world
• Error notes – notes that were
manufactured with mistakes
A note issued by Italy during its occupation of This error was caused by a crease in the
• Items related to banknotes – such Albania, during World War II. This note is of paper before the banknote was printed.
as cheques, traveller’s cheques, interest to collectors of occupation currency. Opening the creased paper, a white “gutter”
is apparent.
private note issues, bills of
exchange, shares and bonds,
merchant notes, letters of credit,
IOUs, banking ephemera, et
cetera
• Notes with a specific date on them
or issued in a certain year; as
collectors might have an interest There are a number of cases of hyperinflation A commemorative banknote issued by
over the years and one of the most recent was Romania to mark the total eclipse of the
in that year. For example, it might in Zimbabwe, where inflation was so rampant, sun in 1999.
be their birth year or notes that the Reserve Bank of Zimbabwe had to issue
banknotes for one hundred trillion dollars.
carry their birth date Many collectors specialize in inflation issues.

How to Build a Collection
M any people start a collection
with a specific objective in
mind, while others pick up a few
lot. This can mean the one note you
are seeking for your collection is in a
lot of, say, six banknotes. Should you
Other collectors: Once you have
determined the objective of your
collection, you can identify other
banknotes here and there before want the specific note, you have to collectors with similar interests. The
deciding on an area of interest. Once an buy the whole lot, which can make best way to do this is by becoming a
objective is determined, the collection auctions a bit daunting. Don’t forget, member of the IBNS and identifying
starts. Banknotes can be obtained from there is usually a buyer’s premium collectors with similar interests.
numerous sources, with the following added to the hammer price.
Visit the country: If you have the
being the principal sources.
On-line sites: There are many on-line opportunity, you may visit the
Banknote dealers: There are many sites where a collector can purchase countries that issue banknotes you
professional and part-time banknote banknotes. These sites can belong collect. However, before you visit,
dealers who will offer notes to to a dealer, an auction house, or a you should determine whether
collectors. Some dealers specialize in general site that offers many types of the issuing authority offers to sell
the stock they sell, while others offer items for sale, including banknotes. notes to members of the public,
general banknotes of the world. Most Some sellers on the general sites offer particularly in uncirculated
reputable dealers in world banknotes, expert presentation with accurate condition. Sadly, many issuing
that is, banknotes of many countries, grades and descriptions. Some sellers authorities do not offer this service.
are members of the International offer a limited degree of expertise and If the central bank does sell
Bank Note Society and their contact the banknotes are often described or banknotes to the public, they usually
details are on the IBNS web site. graded inaccurately. sell the currently circulating notes
Auction houses: There are quite a few and not varieties; for example, not
Collector fairs: There are local
auction houses that have dedicated date or signature varieties. Also keep
and international collector fairs,
auction sales for banknotes, and in mind, in some countries there
where dealers who offer banknotes
other auction houses that have a are restrictions on taking currency
attend. Often, dealers who sell
section for banknotes in their auction out of the country; the restriction
banknotes also sell coins or stamps
sales. Most auction houses have an might limit the person leaving the
and so collector fairs with dealers
online presence and many auction country to a specific sum, or it might
offering these collectables are worth
houses advertise in the IBNS Journal. be a total restriction on removing
attending. There are only a couple of
Auctions frequently combine notes currency from the country. It’s best
international collector fairs where
into one lot, as auction houses seek to check before you travel!
only banknotes are sold and these are
to have a minimum value for each advertised in the IBNS Journal.
What Condition to Buy

W hen buying a banknote,
you must be aware of the
difference in price that is determined
a lower grade note as a “filler” for
your collection until you can obtain
one in higher grade. Some collectors
between dealers, or by looking at
prices realized at auctions, which
many auction houses present on-
by condition. A banknote in prefer to purchase only uncirculated line. Many people judge the value of
Uncirculated condition might be notes, but this becomes impractical a note by its catalogue value, but this
significantly more expensive than a when attempting to acquire certain is not always reliable. If checking a
note in, say, Very Fine condition. If banknotes, either because they are so catalogue value, it is best to use an
you are collecting modern banknotes, rare in very high condition or they up-to-date catalogue specializing in
it is wise and practical to purchase are so expensive. the area you collect. If you decide
notes in Uncirculated condition, When purchasing a banknote, you to pay more than the market value,
as the premium should not be very should always know what price is because you believe the catalogue
significant. If the notes you seek are reasonable to pay for a note. You prices are inaccurate, or because
older notes, it becomes more difficult should generally not pay above you have not seen the banknote
to obtain notes in high grades, and if market value, but you should know available anywhere else, or because
you are having difficulty in obtaining what the market value is. This can you desperately want the item – this
a certain note, it is worth obtaining be achieved by comparing prices should be an informed decision.

Third-Party Grading
W hen you purchase a banknote,
especially at a distance, how
can you be sure the banknote is in the
identified, graded, and “slabbed”
in archival plastic. This process is
intended to eliminate subjective
of a “slabbed” note will achieve
a higher price if the work of the
grading company is respected.Some
condition described by a dealer or opinions of a note’s grade, but a collectors, after buying a “slabbed”
an auction house? Reputable dealers collector should have the confidence note, will remove it from the slab and
and auction houses will ascribe the to agree or disagree with the grade place it in an album or a sleeve.
correct condition, although everyone assigned by the third-party grading
In the end, the more you can learn
makes mistakes. Should a mistake service.
about banknotes, the more confident
be made, these dealers and auction
Not everyone likes this development you can be in determining whether
houses will usually accept the note
as: the slab makes it difficult for to purchase slabbed banknotes and
when returned in the condition it
others to grade the note; there may whether you take the option to use
was bought. Make sure you know the
be differences between the grading the services offered by third-party
terms of sale.
standards used by the third-party grading companies.
In an effort to remove any ambiguity grading services; and it turns a note
in the grade of a banknote, third- It should also be remembered, the
into an investment commodity
party grading (TPG) services have various TPGs do not use the IBNS
rather than an object to be collected.
been established. grading standards; so if you are
Assessment by a third-party grading
buying a note graded by a TPG, check
For a fee, a collector can have notes service may mean the future sale
the descriptions of their grades.
Processed Notes
B ecause banknotes increase in
value as their grade improves,
many people are tempted to process
as an eraser to remove pencil marks.
While removing dirt from a banknote
by non-destructive methods is not
the back of the note, especially if
the fold marks have attracted dirt,
which is more difficult to remove
banknotes to achieve a higher grade. always frowned upon, invariably, in than other surface dirt.
Theoretically, a note that is in, say, some minor way, it will affect the Trimming: Banknotes that have seen
Very Fine condition, can never quality of the banknote. circulation might develop small tears
improve on that condition, but steps or nicks in the edges of the note. By
Washing: To clean a note in a liquid
are taken by some people to make using a sharp knife and a straight
solvent is now commonly done, but not
it appear in a higher grade. While edge, the small tears and nicks can
condoned by most collectors. Washed
there is always debate on the various be removed or reduced by cutting
banknotes were once identified by their
processes to “improve” a banknote, off a small part of the edge of the
odour, with chemicals being detected;
processing or “doctoring” banknotes note, but the banknote becomes
but the people who wash banknotes
is generally frowned upon by the smaller as the edge(s) are trimmed.
have improved their techniques, so
collector community. In this case, look for sharp edges that
now there is little or no odour to a
Reputable dealers will always washed banknote. Washing notes are not consistent with the general
advertise processed notes as such. removes much of the dirt and often the condition of the note. If in doubt, try
Sometimes dealers don’t advertise banknotes are pressed or ironed after matching the note against another
this fact. This might be due to their washing. Washed banknotes can mostly of the same type to see if it is a
wishing to misrepresent the note, or be identified by: different size. Remember that normal
it may be because they are not aware manufacturing variances can create
the note is processed. In the end, you • The very fine lines of creasing on differences of up to 2mm between
the collector must learn to identify the notes, which cannot be removed two notes of the same variety.
processed notes and buy them, or not, and which can be seen under a
good light or by looking across the Repairing: For more expensive
as you see fit. notes, some people employ
note at a low angle (in a good light)
Some of the activities people undertake professional paper restorers to repair
• If there are ink marks on the note,
to “improve” a banknote are: the banknote paper. Repairs usually
the ink lines are no longer crisp,
mean mending a tear or filling a
Cleaning: Banknotes, by circulating, but have become blurred while
hole in the paper. If a tear has been
attract dirt. This may be ordinary grit being washed
repaired it is often very difficult to
and grime, it might be ink or pencil • Have a look at the back of the note. identify if it is expertly done. If a hole
marks, or other substances. Dirt can If the note has been folded, the fold in the paper is filled, the ink of the
be removed by various means, such marks will be more apparent on printing is usually missing.

Collectors and Investors
M
If, as a collector, you purchase a When the number of people wanting
ost people who purchase
banknote for, say, $20, you can the note exceeds 15, the price of
banknotes are collectors,
expect to sell it for $10 to $15. the note increases and the investors
but because money can be made
However, inflation and demand can move in. While this is inevitable, it is
from buying and selling banknotes,
push the price up, particularly for simply a hurdle the collector faces. In
the hobby has attracted investors.
banknotes with a higher retail price. the end, every collector likes to make
This is to the detriment of collectors
If there are, say, 15 known examples money when a collection is sold,
and has led to the rise in value of
of a specific note in a high condition, but it can be frustrating while still
some banknotes, often beyond the
the price of the note will remain low collecting if a collector is competing
reach of many collectors. Like any
while there are fewer than 15 people against investors.
commodity, there is a retail price and
a wholesale price. seeking to acquire the banknote.
How to Store a Collection

T here is every chance you will
end up with a good collection
after a number of years, if you
companies. Some companies
manufacture album pages and
individual holders that have acid-
remain dedicated to your collection, free cardboard backing and archival
and it is therefore worth taking care plastic fronts, that are suitable for
of the banknotes you purchase. By storing banknotes; however they lack
taking care of your banknotes, they the advantage of viewing the front
retain their value and if you decide and back of your banknotes.
to sell any of your banknotes, you
Once in your albums or holders,
should achieve a good market price
banknotes should be stored away
for them.
from direct light, and away from
The two principal methods of storing heat and moisture. Each element—
Banknote album pages come in numerous banknotes in a collection are in light, heat and moisture—affects
page sizes and differing numbers of pockets, albums, specifically designed for banknotes, with some banknotes
sold by a range of manufacturers.
banknotes, and in plastic sleeves. changing colour over a period
However, of utmost importance of time, especially if they are
is the type of plastic in which the subject continuously to light. This
banknotes are stored. If a banknote sometimes leads people to think
is stored in cheap plastic albums or they have discovered a colour variety
sleeves, the notes can deteriorate of a banknote, only to learn it is
because the plasticizers attack discolouration due to poor storage.
the printing and the paper of the
banknote after a period of time.
Inert or archival plastic will protect
your banknotes and it is well worth
paying the extra money these items
cost to maintain your collection.
Mylar is the best-known of the
archival plastics, with album pages
Inert plastic holders are used by many and individual sleeves available
collectors to store their banknotes. The
holders come in a range of sizes and can be in this product. Archival plastic is
stored in file boxes. manufactured by several reputable

Equipment a Collector
should Own
T here are items a banknote
collector should possess. Each of
the following items may be considered
viewing notes they wish to purchase,
to identify damage not apparent to
the naked eye. (It may take some
Journals is available for download to
members and articles covering your
collecting interest might be available.
by the collector, although each item is experience before damage to a note
Subscriptions: There are many
not mandatory: can be identified by use of ultraviolet
companies throughout the world that
Storage: As indicated in “How to light.)
publish numismatic magazines, often
Store a Collection” it is essential Light box: For identifying including articles and information on
to have the best storage for your watermarks and perfect registration banknotes. There are also societies
collection. Banknote albums with features. Especially useful if you are that provide magazines as part of
pages manufactured from inert plastic, photographing the watermark or their membership subscription. By
or sleeves manufactured from inert perfect registration feature. subscribing to certain magazines
plastic, are the best option. Album and becoming a member of certain
Scanner: If you own a computer,
pages and holders made from acid- societies you will be in touch
consider purchasing a scanner. By
free paper and inert plastic covers are with the hobby and possibly with
scanning notes you can save them for
also an option. your collecting interest. Not every
reference, expand the scanned image
Magnifying glass: Invariably, it is magazine and not every society will
and view detail, forward the scanned
necessary to study banknotes closely, meet each individual’s needs, but they
image to fellow collectors with whom
to check various details, such as can be very valuable tools to enhance
you might be discussing aspects of
micro-printing and difficult-to-read the experience of a collector.
the note, and if you decide to write
signatures. For forgery detection, about your banknote, you have an Record of Purchases: When you start
magnification of 20x is recommended. image to illustrate your article. (In collecting banknotes, many purchases
This will be more powerful than scanning notes, there are some issues will be for small amounts and you
you will want to use for every-day of which a person should be aware. might not consider it worthwhile to
examination of notes. First, for modern banknotes, some record the price you paid.
Ultraviolet (UV) lamp: Ultraviolet scanners will not scan the images
As a collection develops, it becomes
light can be used for two purposes. of a banknote, and some software
more important. Consider these
First, ultraviolet light allows the will not print images of banknotes.
examples:
collector to view fluorescent This is due to security features in
some banknotes. Second, in some • You bought a banknote and now
features on the banknotes they
countries not all illustrations are legal want to sell it. What price did you
collect. This shows many beautiful
if they are reproduced at the same pay, from where did you buy it,
features not seen in normal light
ratio as the banknote, that is a ratio and when did you purchase it?
and often a change to features which
may determine a variety. Second, of 1:1. Sometimes 1.5 or 0.5 of the • You bought a note in Fine grade
ultraviolet light can show the hidden size or similar are required. Similarly, and now want to upgrade to Extra
ugly aspects of a banknote. Among photocopies of banknotes are illegal in Fine or Uncirculated. What did
professional graders, it is a crucial tool some countries.) you pay for your Fine note, so
used to identify stains and foreign Reference Books: All collectors you can compare what you are
substances which are not easily seen should have reference books on the prepared to pay for the better note?
by the naked eye. It can also be used banknotes they collect. If you don’t • If you sell part of your collection,
to determine if a banknote has been study the subject you collect, you will you might have to pay capital gains
washed, pressed, cleaned or repaired. never be a proficient collector. The tax, and by recording the purchase
Ultraviolet lamps are available in books can be catalogues, histories, or prices and selling prices of your
fixed or portable formats. Some articles on banknotes. As a member of banknotes, you can correctly
collectors take portable lamps when the IBNS, the entire collection of IBNS calculate your capital gain.

Disposing of your Collection
W hen the time comes to
dispose all or part of your
collection, there are two basic
collection, a dealer might readily
purchase your collection for a
negotiated price. However, if your
each note in your collection to be
offered separately. You will also wait
some time to receive payment, as
options: sell or auction. collection covers numerous areas, once the auction house has received
Selling a collection is usually done notes of varying grades, and contains your notes, they must be catalogued,
by approaching a dealer, perhaps notes of low value, you might the auction must be held, and the
dealers from whom you have bought find it difficult to sell your entire auction house must receive their
notes, or perhaps someone who collection, as dealers are interested in payment before they can pay you.
advertises. You might also have come purchasing notes they can resell.
You might decide to sell your notes
across a collector who is interested Auctioning a collection has the through an online website. This will
in notes from your collection. advantage of competition, with allow you to have control over your
The biggest benefit in selling your many buyers being offered notes sales, but you carry the risks and you
notes to a dealer is you are paid from your collection. If you auction become the retailer. You must create
immediately. The difficulty lies in your notes though an auction house, your own lots and you may have
selling your complete collection. they will put together lots that have mixed fortunes in disposing of each
If you have a strong specialized a minimum value, so don’t expect lot.
Join the IBNS

A nyone who collects world banknotes should consider joining the
International Bank Note Society. Membership will provide collectors with:
• The IBNS Membership Directory, • Access to the IBNS Panel of

published every two years and Experts, to answer questions a
containing a list of all members member may have
at the time of publication (new
• Access to a dispute resolution
members being listed in the IBNS
process between IBNS members,
Journal), and various reference
and
articles of the Society, such as the
Society’s Bylaws and the banknote • Access to our two annual mail-bid
grading standards auctions, whereby banknotes can
be bought or sold.
• The IBNS Journal, a quarterly full-
colour magazine containg articles
on banknotes, a comprehensive To apply for membership, please
list of new issues, Society news, visit the Society’s web site at
and more www.theIBNS.org and take the
• Access to the members-only area appropriate menu option to apply for
of our web site and the very active membership.
IBNS forum

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THE IBNS INTRODUC

Prepared by members of the International Bank Note Society.

2 The IBNS Introduction to Banknotes & Banknote Collecting

T his guide is an introduction for people pursuing an interest in

The IBNS Introduction to Banknotes & Banknote Collecting 3

T oday, the term “banknote” or “bank note” is used to

“Paper money” is another term commonly used to describe banknotes, as

4 The IBNS Introduction to Banknotes & Banknote Collecting

The particular features of a banknote,

Above: This banknote was prepared for the state of Biafra,

Left: This is a privately issued note for seven shillings.

The IBNS Introduction to Banknotes & Banknote Collecting 5

A hand-written bill from Scotland,

A Bank Post Bill issued by Beresford’s Bank, Ireland.

6 The IBNS Introduction to Banknotes & Banknote Collecting

Above: A specimen letter of credit issued by

Left: A cheque drawn on the Cairo branch

Left: A specimen Circular Note

The IBNS Introduction to Banknotes & Banknote Collecting 7

8 The IBNS Introduction to Banknotes & Banknote Collecting

3. The banknotes are

The IBNS Introduction to Banknotes & Banknote Collecting 9

10 The IBNS Introduction to Banknotes & Banknote Collecting

The IBNS Introduction to Banknotes & Banknote Collecting 11

Above: A vignette from an Australian Bank Post Bill, typical of

Above: The claim to copyright on a German banknote.

Warnings to counterfeiters on banknotes from Haiti (top)

12 The IBNS Introduction to Banknotes & Banknote Collecting

T here are many reasons why banknotes are interesting and

The banknotes of Iraq are a good example of

The IBNS Introduction to Banknotes & Banknote Collecting 13

14 The IBNS Introduction to Banknotes & Banknote Collecting

T here are two basic processes to manufacturing a banknote:

The Banknote Material

The IBNS Introduction to Banknotes & Banknote Collecting 15

16 The IBNS Introduction to Banknotes & Banknote Collecting

The IBNS Introduction to Banknotes & Banknote Collecting 17

18 The IBNS Introduction to Banknotes & Banknote Collecting

The IBNS Introduction to Banknotes & Banknote Collecting 19

denomination as numerals or the intaglio ink. Devices printed on

20 The IBNS Introduction to Banknotes & Banknote Collecting

Above: A holographic patch on an

The IBNS Introduction to Banknotes & Banknote Collecting 21

22 The IBNS Introduction to Banknotes & Banknote Collecting

The serial number of a replacement note from

A serial number from a replacement note

The IBNS Introduction to Banknotes & Banknote Collecting 23

B anknotes are usually catalogued

The banknote above was issued by Pakistan

24 The IBNS Introduction to Banknotes & Banknote Collecting

The printer’s imprint from four issues of the

The IBNS Introduction to Banknotes & Banknote Collecting 25

G rading banknotes is important for the collector,

Standard International Grading Terminology and Abbreviations

Abbreviations UNC AU or aUNC EF or XF VF F VG G Fair PR

26 The IBNS Introduction to Banknotes & Banknote Collecting

VERY FINE (VF) FINE (F) VERY GOOD (VG)

GOOD (G) FAIR (Fair) POOR (PR)

The IBNS Introduction to Banknotes & Banknote Collecting 27