DEFINITION of 'Worn Currency'
Currency notes that are torn, damaged or badly soiled. Banks separate such currency notes daily from the amounts that they collect from the public and exchange them for crisp new bills at the Federal Reserve Bank.
BREAKING DOWN 'Worn Currency'
Worn currency notes are assessed by the Federal Reserve Bank,which reviews the notes and determines whether they can be recirculated or should be retired from the money system. The Federal Reserve destroys worn currency notes at some of its banks located throughout the country.