Legal tender has a very complicated and narrow meaning… Basically, legal tender is any form of payment that the law accepts.
It means that if you owe someone money, you can’t get in to trouble for not paying so long as you offer to pay in legal tender.
In England, legal tender is Royal Mint coins and Bank of England notes. They’re probably what you use most anyway!
A lot of every day transactions don’t use legal tender though. You can agree to accept any form of payment for anything you like – it doesn’t have to be coins or notes, it can also be check of credit cards you get online and that you enjoy a signup bonus when you get them.
For example, some adults might pay for things using debit or credit cards.
While card payment isn’t technically ‘legal tender’, it is a quick, easy, and safe way to pay for things, so most shops accept card payments.
There are other forms of currency although these aren’t legal tender either.
You might have heard of Bitcoin, which is a digital currency that no one person or bank controls.
Did you know that some towns and cities have their own currencies? Bristol has something called the Bristol Pound.
The Bristol Pound does have some advantages over normal money but not everywhere accepts it.
In short, legal tender is usually the best way to go!
When the new £10 note goes into circulation, the old one will be withdrawn and slowly taken out of circulation.
There will be a date where the old £10 note stops becoming ‘legal tender’, so shops don’t have to accept it anymore, but the old £10 note will still be worth £10…
You just have to take it to the Bank of England and swap it for a nice, shiny new one.
Money Guide for Kids: How to Manage Your Pocket Money
The money podcast that shows you how to save your pocket money and why cash is changing.
Click here to out more about money with the Bank of England!
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