Since 1971, the British money system is based on the decimal system. The basic unit of British currency (currency of the United Kingdom and the Crown Dependencies) is the pound, which is divided into one hundred pence. (abbreviated as p).
The official full name pound sterling (plural: pounds sterling) is used mainly in formal language and also to distinguish the currency used within the United Kingdom from others that have the same name. (GBP = Great British Pound)
As a unit of currency, the term pound originates from the value of one pound Tower weight of high purity silver known as sterling silver. Sterling silver is an alloy of silver containing 92.5% pure silver and 7.5% other metals, usually copper. The word sterling is believed to come from the Old Norman French esterlin (meaning little star) transformed in stiere in Old English (strong, firm, immovable).
The currency sign is the pound sign, originally ₤ with two cross-bars, then later more commonly £ with a single cross-bar. The pound sign derives from the '£sd' pronounced, and sometimes written as 'LSD'. The abbreviation comes from librae, solidi, denarii (libra was the basic Roman unit of weight; the solidus and denarius were Roman coins). '£sd' was the popular name for the pre-decimal currencies pounds, shillings, pence of the Britain and other countries.
The coins in circulation: 1 penny, 2 pence, 5 pence, 10 pence, 20 pence, 50 pence, 1 pound, 2 pounds.
The notes (paper money) in circulation: £5, £10, £20, £50, and £100.
Scottish £1 notes are still in circulation in Scotland. The Channel Islands and the Isle of Man have some different coins and notes from the mainland but the monetary system is the same.
Writing and Saying Amounts of Money
When we write amounts of money in figures, the pound symbol £ is always shown in front of the figures. For example: 'three hundred pounds' --- > '£300'.
If an amount of money consists only of pence, we put the letter 'p' after the figures. For example: 20p is often pronounced "twenty pee" rather than "twenty pence". The singular of pence is "penny".
If an amount of money consists of both pounds and pence, we write the pound symbol and separate the pounds and the pence with a full stop. We do not write 'p' after the pence. For example: 'six pounds fifty pence' --- > '£6.50'. When saying aloud an amount of money that consists of pounds and pence, we do not usually say the word 'pence'. For example: '£6.50' -- > 'six pounds fifty'.
Note also that we say 2 pounds, 5 pounds, 10 pounds, etc. for amounts of money and 2 pound coin, 5 pound note, 10 pound note, etc. for a piece of money (coins and notes).
Old British Money
Prior to decimalization in 1971 Britain used a system of pounds, shillings and pence. ('£sd' or 'LSD'). The smallest unit of currency was a penny, the plural of which was pence (or pennies). There were 12 pence in a shilling and 20 shillings in a pound. The pound came in the form of a paper bill, called a note, or a gold coin, called a sovereign.
1 farthing (the lowest value coin) = 1/4 penny
A ha'penny (Half penny - a copper coin) = 1/2 penny (pronounced "heipni")
1 penny (a copper coin) = one of the basic units (1d)
Threepence or Thruppenny Bit = 3 pence (pronounced "thrupence")
Sixpence (a silver coin also called a 'tanner') = 6 pence
1 shilling = 12 pence (1s)
1 florin (a silver coin that numismatists regard as one of the most beautiful medieval English coins) = 2 shillings
A half-crown = 2 shillings and 6 pence
1 crown = 5 shillings = 1/4 pound
1 pound = 20 shillings = 240 pence (£1)
1 sovereign = a gold coin with a face value of one pound (about .24 ounces of 22 carat gold)
Farthings were not produced after 1956 and were withdrawn in 1960, because of inflation. In preparation for decimalisation, the ha'penny was withdrawn in 1969, with the half-crown being withdrawn the year after.
A penny was often called a copper after the metal it was minted from.
Pound coins were not minted before the 19th century – the silver equivalent of the pound circulated in shillings and crowns.
A guinea (first issued on February 6th, 1663) was sometimes used as a unit of account. A guinea was a gold coin, originally made of gold from the Guinea coast of Africa, worth 21 shillings (or one pound and 1 shilling) in old British money. A guinea was considered a more gentlemanly amount than £1. A gentleman paid his tailor in shillings, but his barrister in guineas.
One shilling is now equal to five (new) pence making a guinea worth one pound and five pence in todays currency (£1.05).
Slang Terms for British Money
The slang term for a pound or a number of pounds sterling is 'quid' or 'nicker' and there are other slang terms for various amounts of money. The slang money expression 'quid' seems first to have appeared in late 1600's England, probably derived from the Latin 'quid pro quo' - 'something exchanged for something else'. The term 'nicker' is probably connected to the use of nickel in the minting of coins.
The old slang term for a shilling was 'bob' and for a guinea - 'yellow-boy'.
Other slang terms: Fiver = £5, Lady Godiva (Cockney rhyming slang for a fiver) = £5, Tenner = £10, Pony = £25, Half a ton = £50, Ton = £100, Monkey = £500, Grand = £1000.
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