Up until now the Bank has used the Guardian polymer substrate from CCL Secure (previously Innovia Films) for the new £5 and recently-issued £10, both printed by De La Rue.  

Following a lengthy tender process, the Bank has announced that it has entered into 10-year contracts with both De La Rue and CCL Secure for the £20 polymer, with De La Rue handling 25% of the first call-off volume and CCL the lion’s share of 75%.

Supply for the new contract begins next year, and the note – featuring artist JMW Turner – will be issued in 2020.

It is a significant foothold for De La Rue, which lays claim to being the only vertically integrated supplier of polymer banknotes.

The security printer said volumes of its Safeguard polymer nearly quadrupled last year. The substrate is already in use by 15 issuing authorities including Clydesdale Bank and Royal Bank of Scotland.

The contract is particularly important because the £20 note is by far and away the highest-volume note in circulation – more than 2.1bn £20 notes were in circulation at the end of February 2017, compared with 810m £10 notes, and 382m £5 notes.

The Bank of England will require more than 5bn polymer £20 notes to be printed over the next decade. 

De La Rue chief executive Martin Sutherland said: "We are delighted to have been chosen by the Bank of England to supply polymer substrate for the new £20 notes in addition to our existing work designing and printing the notes.

“This new contract is an important strategic milestone and will increase our share of this fast growing market."

The procurement process for the new note began in March 2016. In the intervening period a row erupted over the use of tiny amounts of tallow in CCL’s polymer, which resulted in a public consultation.

The Bank of England subsequently decided that it would not change the formulation.

Bernhard Imbach, vice president and managing director of Wigton-based CCL Secure, said: “We are extremely honoured that the Bank of England has selected Guardian^™ polymer as the initial main substrate for the next £20 note and we are looking forward to continuing working closely with the Bank in bringing cleaner, safer, stronger banknotes to the British public.”

Earlier this year Sutherland stated that a tallow-free version of Safeguard was ready to go into production. A spokeswoman told PrintWeek that the group would consider its position regarding whether to offer both with- and without-tallow variants, in light of the Bank of England’s decision to continue with the formulation that includes trace amounts of tallow.

De La Rue's shares rose by 19.53p, or 3%, to 670p on the news.