Graded versus raw banknotes? What is PMG/ PCGS?

🏛️ What Are PMG and PCGS?

PMG (Paper Money Guaranty) and PCGS (Professional Coin Grading Service) are the two most trusted third-party grading companies in the world of numismatics. They specialize in:

- Authenticating banknotes to ensure they’re genuine

- Grading them on a 70-point scale based on condition

- Encapsulating them in tamper-proof holders with certification details

These services offer peace of mind to collectors and investors by eliminating guesswork and protecting the note’s integrity.

📊 Grading Scale: Key Terms Explained

Banknotes are graded from 1 to 70, with higher numbers indicating better condition. Here’s a breakdown of the most commonly used grades:

| VF (Very Fine) | Lightly circulated | Several folds, minor wear, still crisp and attractive |

| XF (Extremely Fine) | Minimal circulation | Few light folds, sharp corners, strong color |

| AUNC (About Uncirculated) | Nearly perfect | One or two faint folds, excellent eye appeal |

| UNC (Uncirculated) | Never circulated | No folds, crisp paper, vibrant ink |

| GEM UNC (Gem Uncirculated) | Premium UNC | Perfect centering, bold colors, no flaws |

| SUPERB GEM UNC | Museum-grade | Flawless under magnification, exceptional margins and registration |

 

PMG and PCGS also use designations like:

- EPQ (Exceptional Paper Quality) for notes with original, unaltered paper

- PPQ (Premium Paper Quality) in PCGS for similar standards

💰 Why Graded Banknotes Command Premium Prices

Graded notes often sell for significantly more than raw notes due to:

- Verified authenticity: No risk of counterfeits or alterations

- Condition guarantee: Buyers know exactly what they’re getting

- Market trust: Auction houses and dealers prefer certified notes

- Investment value: High-grade notes appreciate faster and are easier to resell

For example, a raw UNC note might sell for $100, while the same note graded PMG 66 EPQ could fetch $180–$250 depending on rarity and demand.

✋ The Charm of Raw Notes

Despite the advantages of grading, many collectors still prefer raw banknotes—and for good reason:

- Tactile experience: Feeling the texture and weight of the paper adds emotional value

- Freedom to inspect: No plastic barrier between collector and note

- Cost-effective: Avoids grading fees, especially for lower-value items

- Personal connection: Raw notes often carry stories, especially when acquired in person or passed down