What is GBP?
GBP is the ISO code for the British pound or pound sterling. Many people call it simply as “pound”. But some people prefer to call it as “pound sterling” or just “sterling” to avoid confusing the word with the unit of weight measurement which is also “pound”. GBP or pound sterling is the official unit of currency of the United Kingdom and its dependencies. In terms of world trading, the GBP has the highest monetary value among all currencies and is said to be 4th most traded behind the US dollar, the Japanese yen, and the EU euro.
As with other units of currencies from other countries of the world, one pound sterling or GBP is divisible by 100, and these are called “pence”. One hundred pence totals to 1 GBP or pound sterling. Before the decimalization that took effect in the year 1971, a single pound sterling is equal to 240 pence. This previous versions of the penny confused a lot of people. Adding to the confusion, another monetary term was used to denote 12 pieces of pence, and these are called “shillings”. But in 1971, the new penny was born and now 100 pence is equal to a single pound sterling.
The GBP prides itself as the oldest monetary currency that is still being used in the world today. First use of the pound as currency was in the Anglo-Saxon period in England. It was then called the silver penny and was said to have originated from Mercia. In medieval times, the penny was created by using silver, which led to its reference as the “pound sterling” today. Over the years, the GBP or pound sterling evolved in terms of size, value, and composition. Along the way, several paper notes or bank notes were issued and printed by the British government, and these notes are also referred to as “sterling” notes.