How do ATM’s detect fake banknotes?

By law, ATMs that accept deposits of banknotes have to ensure that they are the real deal and not some bad-ass counterfeiter’s forgery. With over half of all new ATMs also being ‘cash recyclers’, this presents something of a technological challenge.

So how does an ATM – or any note-accepting machine, for that matter – do it?

By looking at a variety of security features embedded in the note.

Remembering that banknotes have at least 34 such features embedded in them – some you can see, some you can’t, and some can only be seen with specialist equipment – which ones might these be?

It depends. Every ATM can be configured differently depending on what type of note it expects to accept. And the settings and sensitivity for recognising each security feature can be altered, sometimes remotely from a control centre far away.

But all banknotes have the following common features, so it is likely that at least two from at least two categories will be part of the authentication process … which two is anybody’s guess:

Optical: ATMs contain small light-sensitive, photo-voltaic sensors as well as miniature digital cameras. These optical sensors look at any number of the security features just described and determine whether the cash being inserted conforms to pre-set templates and is therefore genuine. Certain inks are also fluorescent and glow when various frequencies of infra-red and ultra-violet light are shined on them.

Magnetic: Cash is magnetic and this magnetism can be detected by what are called ‘Giant Magneto-Resistance’ (GMR) proximity detection devices. Inserted notes are passed over an array of small magnets which can detect not just the presence, but the orientation of the iron particles in the ink. This results in a recognisable magnetic signature. Hold a banknote near a strong enough magnet and you might be surprised to see that it is attracted.

Radioactive: Some higher denomination notes use radioactive inks. The tiny amounts of radiation emitted – thousands of times less than that to which you are exposed when flying, for example – can be detected by small Geiger-Muller counters.

Size: The thickness, length and breadth of banknotes are different for each type and denomination. Notes are typically 0.0042 inches thick and weigh slightly less than a gram. British £5 notes weigh 0.812 grams when printed but are nearer 1 gram in weight when dirty. The thickness is measured by laser scanner or by measuring the gap between two rollers as the note is inserted. Coins are evaluated based on their weight, size, magnetic signature (alloy composition), depth and width of edge serrations, and the depth of embossed image.

Conductivity: Being of a different size, being made of different ‘paper’, and containing different types and numbers of security devices, each banknote of a certain currency and denomination has its own electro-static conductivity and therefore resistance. It is possible, therefore, to tell one from another by running an electrical charge through it which miniature transducers on either side of the note then measure. This method is entirely accurate and works even when notes are wet.