10:43 21 August 2009
Cash machines will begin stocking £5 notes again in a bid to help customers hit by the recession manage their money more efficiently.
HSBC and Barclays targeted low-income areas, along with university and college sites, where withdrawals tend to amount to £10 to £20 each time, rather than the national average of £60.
Many people want a £5 to return, according to the Payments Council, a department responsible for ensuring payment systems function properly.
Sandra Quinn, the council's director of communications, said: The recession may well be playing a part. They might find a lower denomination a better way of managing their money.
Around a decade ago, cash machines gave out £5 notes regularly, but more recently customers have had to opt for either £10 or £20 notes instead.
A Barclays spokeswoman said: 'It tends to be more in the North because people tend to have less money and there is a social inclusion factor as well.
HSBC, in a joint venture with the Bank of England, trialled stocking £5 notes in the south west and the midlands in July.
Ron Delnevo, managing director of Bank Machine, which brought in £5-only ATMs last year, claims that people are avoiding using credit cards as much as possible to keep an eye on their more visible funds.
Because £5 notes get used far more regularly than higher denomination notes, they have a much shorter lifespan, becoming damaged a lot easier as opposed to the rarely used £50. The average £5 note lasts for only one year; whereas a £50 can last for five years or more.
All cash machines can dispense £5 notes, but the majority of banks chose to load them with only £10 and £20 ones.
An HSBC spokesman said: 'It is a trial the Bank of England has been talking to us about to try to increase the number of £5 notes in circulation.'
Another factor is that in addition to £5 becoming damaged quicker, retailers also tend to hold on to them to give out as change, rather than returning them to the banks.
This means that there are fewer opportunities for damaged notes to be withdrawn from circulation. To compound the dilemma, the fact that so few cash machines dispense them, means that it is more difficult to get brand new £5 notes into circulation in the first place.
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