Bank note

Bank note or banknote is a type of currency, specifically a type of negotiable instrument known as a promissory note, made by a bank, payable to the bearer on demand. Banknotes were originally issued by commercial banks, which were legally required to redeem the notes for legal tender (usually gold or silver coin) when presented to the chief cashier of the originating bank. These commercial banknotes only traded at face value in the market served by the issuing bank. Commercial banknotes have primarily been replaced by national banknotes issued by central banks or monetary authorities.

History

The concept of banknotes originated in China during the Tang and Song dynasties. In the 14th century, it was transmitted to Europe through the agency of the Mongol Empire, and by the 17th century, it was used in most parts of the world.

Design and production

Banknotes are usually made of paper or polymer banknote substrate. They are often decorated with elaborate designs and motifs to increase their security features and to discourage counterfeiting. The design of banknotes is a complex process involving highly trained professionals working in the fields of graphic design, engraving, and printing.

Security features

Modern banknotes incorporate several security features designed to prevent counterfeiting. These may include watermarks, security threads, holograms, and special inks that change color depending on the angle of the light.

Collecting

Banknote collecting, or notaphily, is a rapidly growing area of numismatics. Though generally not as widespread as coin and stamp collecting, the hobby is increasingly expanding in popularity.

See also

• Currency
• Counterfeit
• Numismatics
• Notaphily