KAlmost a year after the issue stop for the 500 euro note, the most valuable euro banknote is still very popular. “The majority of the 500s are still in circulation,” said Bundesbank board member Johannes Beermann of the German press agency in Frankfurt.
The Deutsche Bundesbank and the Austrian National Bank last issued the purple note on April 26, 2019. The other 17 national central banks of the Eurosystem had already finished issuing the 500 euro note on 26 January 2019.
In 2019, 500s worth a net 14 billion euros were returned to the Deutsche Bundesbank. “With a volume of just under EUR 160 billion outstanding at the Bundesbank at this point, this is only a small proportion,” explained Beermann. “Even in the first months of this year, only a few 500s flowed back to the Bundesbank.” Germany’s monetary authorities are observing a similar trend for the entire Eurosystem.
At the beginning of May 2016, the Council of the European Central Bank (ECB) decided that the production and issue of the 500-euro banknote would be stopped “towards the end of 2018”. In the revised second series of common banknotes, there is no longer a 500-euro note. The 500s in circulation remain legal tender and can be exchanged at the national central banks in the euro area without any time limit. Proponents promise that terrorist financing and undeclared work will be pushed back by foregoing the € 500 bill.
269.9 billion euros in circulation
“I still have no evidence that the freeze on the 500-euro banknote can effectively combat the shadow economy or money laundering,” Beermann affirmed. “The Deutsche Bundesbank supports all measures that make criminal or terrorist activities difficult. But so far there has been no significant demonstrable connection between the extent of the underground economy or crime and the availability of banknotes in high denominations. “
The new 100 and 200 euro notes with improved security features that the central banks have been in circulation since May 28, 2019 are in high demand as a possible alternative to the 500. “We see a significant increase in the demand for 100 and 200 euro notes. The 200-euro banknote in particular, which was previously little in demand, was paid out significantly more frequently last year, ”Beermann said. Accordingly, the Bundesbank issued a net 26 billion euros in 200-euro notes and a net 22 billion euros in 100-euro banknotes in 2019. The outstanding volume of the 200s at the Bundesbank rose by 63 percent.
According to data from the European Central Bank (ECB), around 540 million 500-euro notes with a value of 269.9 billion euros were in circulation at the end of 2016. In January 2020, a good 440.5 million pieces of the purple banknote with a value of around 220.3 billion euros were still in circulation.