Plastic banknotes are set to be introduced in Britain, replacing the paper money used for more than 300 years, according to Daily Mail.

The radical overhaul could see the more durable, waterproof and harder-to-counterfeit polymer sterling notes in circulation within three years.

The Bank of England has put out a £1billion tender from 2015 for the printing of notes at its press in Debden, Essex. Part of this process demands that bidders are able to cope with the change from paper to plastic from the start of the contract.

Since 2003, the contract has been held by De La Rue – one of only two makers of polymer notes.

The company, which prints more than 150 currencies, has just produced new plastic banknotes for the Pacific island of Fiji.

Plastic notes were first introduced in Australia in 1988 as a measure against counterfeiting. They have proved a success, and are apparently particularly popular with surfers who are able to keep money in their pockets without it disintegrating.

Other countries to issue polymer notes include New Zealand, Romania, Papua New Guinea, Mexico and Vietnam. In Northern Ireland, a plastic fiver was introduced in 1999 to mark the Millennium.

Plastic notes last much longer than cotton fibre-based paper ones. For instance, an Australian $5 bill lasts about 40 months, against six months for a £5 note.

Polymer notes are more hygienic as they absorb fewer bacteria, harder to tear or crease – making them easier for vending machines – and waterproof, even able to survive being put in the washing machine.

A key feature is a clear window, which normally contains an ‘optical variable device’ that splits light into its component colors and is extremely hard to counterfeit. Plastic notes can also contain holograms.

They are also more environmentally friendly as fewer need to be produced and they can be recycled.

However, they are considerably more expensive to produce and would create an initial cost as ATMs and vending machines would have to be adapted to accept them.