The majority of euro notes created are not used to pay for purchases.
It may come as a surprise, but more than one in two payments is still made in cash in the European Union. According to the latest study by the European Central Bank (ECB), 59% of transactions are carried out, on average, in cash in the 27 member countries. With some disparities since the proportion is only 50% in France, compared to 70% in Austria or even 20% in the Netherlands. Cash therefore still has a future. And the printing presses will continue to be printed in the 11 European printing houses responsible for creating the real currency.
According to the figures provided by the ECB, 29.5 billion banknotes are in circulation in the EU. Mountains of 5, 10, 20, 50, 100, 200 and even 500€ which represent a total of 1,500 billion euros. In 2022, France alone manufactured 1.05 billion banknotes, making it the largest producer in the Union. However, all this money does not go directly into wallets, far from it. It is only a small part that is used to power the banking system on a daily basis, when the majority of impressions are kept warm.
Indeed, the European Central Bank indicates that only 20% of the money created is used for transactions. But where does the rest of the money go? A part (between 30 and 50%) is held by people who are not in the Euro zone and therefore cannot use the tickets to make purchases; the other is… hidden: in safes, under mattresses, in shoe boxes or even buried in gardens! And this is not a joke ! Here again, the European monetary institution estimates that between 30 and 50% of the notes designed are carefully kept as reserves, both by individuals and by the ECB and the central banks of each country, or even banks. “This distribution by sector has not yet been determined,” specifies the European Central Bank.
The exercise of monitoring the tickets produced is perilous given the impossibility of tracing each of them. “The data collected refers only to banknote flows through central and commercial banks, so only a small part of the liquidity cycle is observable,” the survey says, agreeing that “there are also gray areas where there are It is impossible to define when a note is held for transactions or as a reserve.” But banknotes still have a bright future ahead of them: their production continues to grow over the years.