A used note is a piece of paper currency that has been circulated, usually showing signs of wear. This contrasts with uncirculated notes fresh from the printing press. Paper currency is continuously being cycled through society, with damaged and soiled notes pulled from circulation while new notes are released to replace them. This is designed to keep a steady supply of paper currency available to members of the public, as well as banks.
People seeking money for ransom, bribery, and other illegal activities often specify used notes for these applications. There are a number of reasons for this, including the fact that serial numbers on used notes will be random, making them more difficult to track unless people have time to record them before releasing the notes. A large supply of uncirculated notes can also be difficult to unload, as it may appear suspicious, while people with numerous used notes can quietly spend and distribute them without attracting attention.
Counterfeiters tend to weather and age their banknotes, as it can more difficult to spot problems with a used note. A torn, soiled used note that has been folded and rumpled will be easier to pass than a crisp, new one where every flaw is clearly visible. Aging counterfeit currency allows people to compensate for problems like paper texture that does not feel quite right or slightly off ink colors. This process of conditioning bills can be an important stop along the way to producing a run of counterfeit currency.
For people who collect paper currency, uncirculated notes are preferred because they will be in the best condition. Sometimes, they are not available or are very highly priced, forcing collectors to turn to used notes. Each used note is given a grade based on its condition. High grade notes with no tears and stains are more valuable than damaged notes. In catalogs where information about banknotes available for sale is provided, the grade will be indicated for each used note so buyers can decide if they are interested.
The central bank of a nation is responsible for maintaining the cash and currency supplies. As banks accept notes for deposit, they are eventually funneled to facilities maintained by the treasury, where employees count the money and discard heavily damaged notes, usually with the assistance of automated equipment. Notes to be taken out of circulation are shredded, and the shreds may be used in the production of products, usually novelties.