Where has all the money gone? [UK]

[Information Analyst]

BBC News: Half of UK cash in black market or overseas, says Bank

"At least half of all UK banknotes in circulation are held overseas or used in the black market, a Bank of England report suggests.

The Bank, which is the main issuer of banknotes in the UK, said only about a quarter of cash in circulation is being used to buy and sell things.

Some is being hoarded, outside of bank accounts.

Much is held for travel money overseas or used illegally in the "shadow economy", the Bank said.

'Cash will survive'

Banknotes with a value of £62.6bn were estimated to be in circulation at the end of July, according to the latest figures from the Bank.

That is the equivalent of £1,000 for every person in the country."


Obviously the Bank of England is able to work this staggering black hole out, by virtue of banknotes being redesigned - and the old versions withdrawn from circulation - fairly regularly.

It will be interesting to hear is any non-UK forum members can account for any notes retained for future use, or indeed UK-based ones with a biscuit tin full of them under the bed!

 

[GlennB]

It will be interesting to hear is any non-UK forum members can account for any notes retained for future use, or indeed UK-based ones with a biscuit tin full of them under the bed!

We've got about 40 quid left from our last UK trip. Keep counting

 

[The Don]

There's £380 in cash in the Wyld Bird Seed kitty - it'll be spent on the band meal in October and so will be back in circulation.

I've also kept a £5 note in my mp3 player pouch just in case I need to buy something when I'm out running. It's been there a few years.

 

[Horatius]

I don't see why this is a concern. If it's being sent overseas and not coming back, then someone has basically traded you real goods or services for fancy paper, and won't ever expect something in return for that paper.

And if it's being used for crime, not only do you have the above factor, but you also have the added benefit of sticking criminals with easily-identifiable stacks of cash money, which when found, can be seized, and used as evidence against them.

So what's the problem here?

 

[Jrrarglblarg]

I have UK money left from my time in the USAF (mid to late 80s) but I don't think the Bank is talking about people with a tubesock of pence in the back of a closet.

I also some Spanish pesetas left. Maybe someday they'll be worth collector sale, but I'm not expecting to pay off the house with it. Yet.

 

[fagin]

I have a credit card, an overdraft, and £1 in cash.

 

[casebro]

How does the OP compare to U.S. dollars?

And what is the harm/benefit?

 

[mbp]

I've got something like £30 lying around.

 

[rjh01]

How does the OP compare to U.S. dollars?

And what is the harm/benefit?

One benefit to people hoarding cash is that the government could print more money without risking inflation. The risk is that a lot of this cash coming back onto the market.