Why are there 500 euro banknotes
Why are there no more 500 euro bills as of today?
Published on April 26, 2019
More than half of German citizens do not want to do without cash. As of today, however, at least the 500 euro note is increasingly disappearing from the wallet. We have received questions from our readers about what will happen to the 500s, why it was decided to abolish it at all and what is happening with the other banknotes. You can find the answers here.
Why is the 500 euro note being abolished?
The European Central Bank (ECB) is the monetary authority of the euro zone and is therefore responsible for the end of the 500 euro note. She wants the abolition Curb terrorist financing, drug trafficking and money laundering. So it was previously possible to easily store and transport large sums of money. This should now be made much more difficult for criminals.
In addition, the In any case, 500 euro notes are hardly ever present in everyday life. A good 500 million banknotes were in circulation in the euro area at the end of 2018. That doesn't even correspond to one ticket per EU citizen. For comparison: at the same point in time, 10 billion of the 50 euro note were spent around 20 times more. Many shops also do not accept the 500 as a means of payment.
Will the previous 500 euro bills remain valid?
For consumers, the abolition of the 500 euro note has initially no consequences. "The 500 euro note will always keep its value and can be exchanged for an unlimited period at the national banks," announced the ECB. The 500 remains a valid means of payment and exchange.
Is there a threat of the abolition of cash in Germany?
According to surveys, more than half of German citizens cannot imagine doing without coins and bills. However, the concern that the abolition of the 500 euro note could lead to the complete end of cash is unfounded. In its decision, the ECB made it clear that the remaining bills untouched stay.
However, it looks different with the cent coins. With Belgium, Finland, Ireland, Italy and the Netherlands five countries in the euro zone already have the 1 and 2 cent coins abolished. There it is rounded to the nearest 5 cents. The Federal Ministry of Finance, on the other hand, is currently making no move to abolish the small cent coins.
Will there be new notes from other banknotes in the future?
Since 2013, the euro bills have been gradually replaced by new banknotes. There are now new editions of the 5, 10, 20 and 50 euro notes. Next are End of May 2019 the 100 and 200 euro notes on it. You will now receive a watermark, a portrait window and a so-called "satellite hologram", which is supposed to make it particularly forgery-proof.
In addition, the new 100 and 200 euro bills are being reduced to the size of the 50s so that they fit better in the wallet. Unlike the current 5 and 10 euro bills, however, they are not painted, as they change hands much less often and are therefore less stressed.
Who is criticizing the end of the 500 euro note?
The abolition of the 500 euro note is controversial. Critics complain that criminals are hardly deterred by the end of a banknote. Also the Curbing counterfeit money is not achieved with this measure. In Germany, for example, there are only around 1,000 fake 500s. They make up just two percent of the total volume of counterfeit money. The front runner with over 40,000 counterfeit banknotes is the 50 euro note.
In addition to the low benefit, according to critics, also arise high costs through the end of the 500 euro note. Because in the long run hundreds of millions of purple banknotes will be exchanged. The production of a note costs eight to nine cents. Since numerous new banknotes have to be printed for the exchange of a 500, the ECB reckons with costs of at least half a billion euros.
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