The U.S. monetary authorities are moving forward with an ambitious program aimed at strengthening the security of the financial system and protecting confidence in the dollar. Under the coordination of the Bureau of Engraving and Printing (BEP), the entity responsible for the design and printing of banknotes, and with the support of the Secret Service and the Committee for the Prevention of Advanced Counterfeiting, the green light was given to an initiative aimed at removing from circulation dollar bills that show serious damage. This plan seeks to reduce counterfeiting and prevent the circulation of “mutilated” bills or those with signs of notable deterioration. Among the actions envisaged is the free replacement of notes in poor condition and a progressive renewal of all denominations, from USD 2 to USD 100.
Banknotes that will no longer be accepted in stores and banks
According to the BEP, a banknote is considered unfit for everyday use when:
- It presents worn or discolored shades.
- It has trimmed edges or broken corners.
- Shows traces of humidity or stains that compromise its material.
- It shows visible marks that make it difficult to handle or read for security purposes.
Several of the most important retail chains in the United States, such as Walmart, Dollar Tree and Target, have communicated that they will not receive these bills as a form of payment. In addition, many banks and ATMs may reject them due to increased authentication controls.
This measure affects all denominations: USD 2, USD 5, USD 10, USD 20, USD 50 and even USD 100. The objective is to ensure that the paper money in circulation maintains its legitimacy, facilitates fraud detection and preserves the good reputation of the dollar in local and international transactions.
Counterfeit alert and new printing technology
U.S. authorities have been observing an increase in the use of advanced counterfeiting techniques for years, so new security features are being introduced on banknotes:
- Security threads visible when the banknote is held up against the light, with the inscription “USA”.
- 3D stripe that changes its design when the bill is tilted.
- Ink that changes color in one of the lower corners (usually the right corner).
- Watermark noticeable when the banknote is viewed against the light.
- Microprints around the main graphics.
- Embossed printing, detectable by touch, especially in text and numbers.
It was reported that in 2026 new versions of some banknotes, such as the USD 10 banknotes, will start circulating with a completely renewed design. However, the changes will be progressively extended to other denominations in order to combat currency piracy and prevent fraud.
Why can they become “useless”?
The authorities have been clear in stating that damaged banknotes will not lose their value completely, but they may be rejected in stores and financial institutions when making payments. This is because, if a banknote has substantial damage, it is much more difficult to verify its legitimacy and security measures.
Consequently, it is not that the paper itself is worthless, but that, for security reasons, it will be taken out of circulation. In order not to keep “useless” dollars at home, the Treasury Department and the BEP offer a mechanism to exchange deteriorated bills for new and good condition ones.
How to make the exchange: the role of the BEP and the Treasury Department
The Bureau of Engraving and Printing has a Mutilated Currency Division, in charge of processing damaged bills. According to official data, more than 22,000 requests are received each year, with a value of more than USD 35 million in banknotes that have suffered different types of incidents: fire, humidity, exposure to chemicals or damage by animals.
For those who have banknotes in such conditions, the exchange is free of charge. These are the recommended steps:
- Collect banknotes that show damage (discoloration, cuts, visible marks, etc.).
- Check the official website of the BEP or the Department of the Treasury for the location of the offices or how to request the exchange by mail.
- Complete the required documentation detailing the origin and condition of the bills.
- Send or personally take the banknotes to the designated facilities, following the indications given in the official guide.
The regulations state that if more than 50% of the ticket is retained and the security features are correctly identified, the exchange is made at full face value. In the event that less than 50% of the piece is available, an investigation is carried out to determine whether the remainder was completely destroyed and to rule out any type of fraud.
A redesign reaching all denominations
In addition to recalling the deteriorated bills, the US Government has a redesign plan in place for dollars. The improvements are aimed at tackling counterfeiting and cover:
- USD 2 and USD 5: with renewed details in the portrait and greater integration of security inks.
- USD 10 and USD 20: incorporation of 3D bands and updated micro text.
- USD 50 and USD 100: reinforced security mesh and additional holograms.
Although the transition will be gradual, travelers and users are advised to be aware of the new features to easily recognize a genuine bill. This is crucial both for operating in the U.S. and to prevent scams in transactions with other countries.
Things to know before visiting the United States
- Check the condition of dollars before traveling or buying and selling.
- Avoid trying to use bills with excessive wear and tear, as they may be rejected in stores or banks.
- Be informed about exchange options in case you have mutilated currency.
Finally, the BEP and the Treasury Department stress the importance of not discarding damaged bills without first verifying the possibility of exchanging them. This protects the value of cash and supports the fight against counterfeiting.
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