In the first half of 2020 just over 15,700 counterfeit euro banknotes were withdrawn from circulation in the Netherlands. This was 23% less than in the first half of 2019. The decrease was most marked in the second quarter of 2020 (-47%) and can be attributed to the economic lockdown in the...Read more
A Counterfeit banknote can be recognised in a second
How much time do you need to recognise a counterfeit banknote and which of the senses are the most effective? DNB research shows that the combination of looking and feeling works best. People can easily distinguish between genuine and counterfeit banknotes even within the space of a single second. If they take more time, the results are even better.
The Dutch rarely check a banknote for authenticity
Dutch people do not commonly check euro banknotes for authenticity, because the chance of running into a counterfeit is small and because they trust the banknotes issued from ATMs or received as change in shops. However, in some situations they do tend to check their banknotes more closely. For example, if they have previously been the victim of money counterfeiting, if they buy something directly from another person, or if the banknote has a strange feel to it. Are people able to properly distinguish between genuine and counterfeit banknotes? What senses play a role here? How much time is actually needed for proper authentication?
Combination of looking and feeling works best for recognising counterfeit notes
De Nederlandsche Bank (DNB) conducted two field experiments to find the answers to these questions.
In the first experiment, participants were asked to recognise counterfeit notes in circulation by looking only at pictures of banknotes on a computer screen. After each picture, the participants had to indicate whether the banknote was genuine or counterfeit. In the second experiment, people were asked to say whether a banknote was genuine or counterfeit by either feeling it while being blindfolded, or by feeling it and looking at it as in normal circumstances. Both experiments were conducted with a short assessment period (1 second) and a longer assessment period (up to 10 seconds). For purposes of comparison, experts were asked to do the same. The analyses used a measure of sensitivity which takes into account both the correct classification of counterfeit notes and the incorrect classification of genuine notes. If participants make their choices at random, this sensitivity measure will be 0. A score above 1,25 is a reasonably good assessment. A score of just under 4 is a perfect score.
Figure 1 -Scores for authenticity recognition by sense and assessment period, for members of the public and experts
When the participants could only watch the notes on a screen, the average assessment scores were insufficient. However, the results were better than with a guessing strategy, even with a viewing time of only 0.5 seconds. A longer viewing time had no impact on the outcome, however.
Feeling only is not enough to recognise counterfeit banknotes
When the participants could only feel the notes, the assessment scores were also insufficient. This contradicts the often expressed opinion that you can always feel that a banknote is counterfeit. As in the case of just looking, the result is still better than guessing. In this case, a longer feeling time does result in better scores, however.
On the basis of both experiments, we conclude that people are surprisingly good at distinguishing genuine and counterfeit banknotes by looking and feeling at the same time, even with an assessment time of just 1 second. Assessment scores increase with a longer assessment time. Although the chance of receiving a counterfeit banknote is only small, the results of this study show that checking your banknotes can be effective and literally takes just a second. It is a sensible thing to do, given the fact that the share of “low-quality” counterfeits has increased in the past six months.