THE Island earned £2.8m from Jersey currency in circulation last year, as banks continue to be encouraged to use Jersey notes as much as possible.

Every time Jersey money enters circulation the States make an investment of equal value that is returned when the money leaves circulation.

The interest earned in the meantime is kept by the Treasury and is effectively free income, according to the Treasurer of the States Ian Black.

In 2004 the amount received from £1, £5, £10, £20 and £50 notes was £2.8m, and coinage raised a further £187,000.

In 2003 £2.1 million was collected.

Mr Black wants Islanders to use Jersey currency where possible rather than English notes, which benefit UK Chancellor Gordon Brown.

On 27 December there was £64.7m worth of Jersey currency in circulation – the amount rises at the peak of summer and in the weeks around Christmas – all of which is earning money for the States.