Bank of England could use palm oil in new £20 note

The Bank of England is pondering using palm oil in the production of the new £20 note following criticism from vegans and religious groups after the revamped £5 note was found to contain traces of animal fat.

The central bank has launched a public consultation on the materials used in the polymer plastic £20 note, with the launch date put on hold, and the reprint of the £5 and £10 notes.

It said last month that it will not withdraw the current £5 notes in circulation and the new £10 notes will be launched as planned in September.

When the new polymer £5 note was launched in May vegans, vegetarians and religious groups voiced their outrage that the note contained tallow, a by-product mainly derived from livestock farming.

Using palm oil instead of tallow is estimated by the bank to add about £5m to the cost of production, which is currently around £300m, for the next 10 years.

The bank said that palm oil offered a "mature supply chain and is available at reasonable cost" and it has started testing palm oil to make sure it meets technical requirements which are expected to finish in the summer.

However, there are concerns about deforestation and the impact of increased palm oil production on the environment.

Emma Keller, agriculture commodities manager at the World Wide Fund for Nature, said that she was “encouraged” by the report the bank conducted with Experts in Sustainable Forest & Agricultural Advice (Efeca), a nature consultancy.

"Palm oil has benefits as it produces more oil per land area than any other equivalent oil crop. Worldwide demand is expected to double again by 2050 but this expansion comes at the expense of human rights and tropical forest – which forms critical habitat for a large number of endangered wildlife – unless it is sustainable.

"People don’t want the bank notes in their pocket to come with such a high environmental cost. The bank must only source RSPO (Roundtable on Sustainable Palm Oil) certified sustainable palm oil or none at all."

The Efeca report claimed that palm oil was responsible for 8% of deforestation between 1990 and 2008.

The bank maintained that it would use sustainable levels of palm oil, should they choose to use it in the production the new polymer bank notes.

Members of the public are able to comment on the consultation on the bank’s website until 12 May.