LONDON -- Britain has unveiled a radically redesigned £1 coin, and converting machines to accept it will be no small change for the vending industry. The Royal Mint is touting the 12-sided coin as the most secure in the world. Set to enter circulation in 2017, it is styled after the old "threepenny bit" in the U.K. that circulated between 1937 and 1971. The existing gold "round pound" coin replaced the £1 note in 1983.
Several features of the planned new coin should make it more difficult to counterfeit, including its 12-sided shape, its combination of two differently colored metals and Integrated Secure Identification System (iSIS) technology developed by the Royal Mint.
As many as 45 million, or 3%, of the pound coins now in circulation are said to be counterfeit.
Officials from the Royal Mint estimate that the cost of converting coin-operated machines to accommodate the new coins would be £15 to £20 million ($25 to $33 million). But industry experts say the expense will be much higher.
The Automatic Vending Association, which represents manufacturers of vending machines, estimates that 450,000 vending machines will need to be adapted. An estimated 100,000 parking machines and 60,000 payphones would also must be overhauled.
New 5 penny and 10 penny coins were introduced in 2012, costing the vending industry alone £25 million ($41 million) in payment system modifications, according to AVA. The Treasury had estimated that retrofitting all coin-operated machines would cost businesses £80 million ($132 million).
The vending industry has criticized the government for giving short notice ahead of previous coin changes. This time, it has been given a longer three-year timetable to prepare.
Royal Mint officials said they will consult with stakeholders to assess the impact to the coin-machine industry and make the changeover as smooth as possible.
"It is imperative that the vending industry works with all the other interested parties to ensure that the security and implementation can be undertaken at the lowest possible cost to industry due to its large legacy machine base," AVA said. "AVA supports the development of a new coin which is more secure than its predecessor and can incorporate new technologies in the future and works through the existing machine base at minimal cost."