The new 12-sided £1 coin will enter circulation on 28 March 2017 and the old-style coin will be defunct by mid-October, the Treasury has announced.
The government is launching a campaign to encourage the public to return the round £1 coins. The Treasury estimates that £1.3bn worth of coins are stored in savings jars across the country. The current £1 coin accounts for almost a third of these.
They must be returned and exchanged before 15 October 2017, when they will lose their legal tender status, the Treasury has said.
It is the first time for more than 30 years that a new £1 coin has been introduced. The change has been made due to the ease with which counterfeits were being made.
It is estimated that 3% of the existing £1 coins are fake. The new coin will be the most secure coin in the world, it is claimed, with several new security features, including a hologram, to prevent copies.
David Gauke, the chief secretary to the Treasury, said: “March 28 should be an important date in everybody’s calendar this year – as we will have a new quid on the block.
“This is a historic moment as it’s the first time we’ve introduced a new £1 coin since 1983, and this one will be harder to counterfeit than ever before. Our message is clear: if you have a round £1 coin sitting at home or in your wallet, you need to spend it or return it to your bank before 15 October.”
Around 40% of vending and other cash-receiving machines will require their coin mechanism to be removed and sent away to be upgraded due to the change.
The British Parking Association believes changes to parking meters will cost £90-£130 a machine for the simplest software upgrade, and considerably more if the meter must provide change.
The Royal Mint has put the cost of changing “all the machines in the country” at £15-£20m, although many industry experts believe that is an optimistic estimate.
Helen Dickinson, chief executive of the British Retail Consortium, said she believed businesses would be ready to deal with the changes.
She said: “While there will be a natural transition period where some vending systems may only be able to accept the existing pound coin, our industry is committed to ensuring we’re fully prepared ahead of the launch in March.”
The Royal Mint has produced more than 2.2 billion round pound coins since 1983, when it replaced the £1 note. The note was removed from circulation on 11 March 1988, although it is still redeemable today at the Bank of England’s offices.
One-pound notes continue to be issued in Jersey, Guernsey and the Isle of Man, and by the Royal Bank of Scotland.
The Royal Mint will make more than 1.5bn of the new coins, whose design is based on the old 12-sided three-penny bit, which went out of circulation in 1971. It is being made at the Royal Mint in Llantrisant, Wales, at a rate of up to 2,000 a minute.
The Treasury said some of the round coins returned by the public would be melted down and reused to make the new coins.
