When people think of money, they usually have cash in mind, i.e. banknotes and coins. Banknotes are bills. Coins are minted pieces of metal. They are both denominated in a specific amount ( face value ) in a specific currency. Since the beginning of 2002, the currency in Germany – as in the entire euro area – has been the euro. Coins complement banknotes for small payments. Your face value is generally higher than the metal value – so also with the euro coins. Such coins are called Scheidemunzen.
Euro cash is legal tender in the euro area
Euro banknotes are the only unrestricted legal tender in the euro area. Every creditor of a monetary claim must accept unlimited quantities of banknotes from the debtor in fulfillment of his claim, unless both parties have agreed otherwise by contract and statutory acceptance restrictions do not prevent this.
Unlike banknotes, euro coins are legal tender only to a limited extent. In the euro area, a creditor is not obliged to accept more than 50 coins per payment. Creditors and debtors can also exclude payment with coins altogether by contract.
2.1 Issuance of cash
Anyone using cash must be able to rely on the fact that banknotes and coins are valid money. Cash is therefore not issued by private companies, but only by government institutions. They guarantee the high quality and security of banknotes and coins.
Monopoly on notes and coinage
Banknotes are issued by the central bank, coins by the state.
In the euro area, the European Central Bank and the national central banks of the countries that have adopted the euro as their common currency are authorized to issue banknotes. The German Bundesbank has a monopoly on banknotes in Germany. It puts banknotes into circulation primarily via commercial banks. The volume of banknotes put into circulation is determined solely by demand. For this reason, the Bundesbank issues all the cash required by the banks and their customers, usually as part of a loan to the commercial banks.
In contrast to banknotes, the euro countries are responsible for euro coins. This is a relic of the old days, when only coins were in circulation. Even in those days, the right to regulate coinage rested with the sovereign, or. with the state (so-called. coin shelf). In Germany, the Federal Ministry of Finance has euro coins produced. The Bundesbank then puts them into circulation.
No cover requirements
The issuance of euro cash is not tied to any cover requirement.
In earlier times, central banks were obliged to exchange issued banknotes for gold or silver. For this reason, they often had to be "backed" by a certain percentage of the corresponding precious metal. Banknote issuance was thus limited by the available stocks of precious metals. It is now known, however, that such regulations are not necessary to safeguard the value of money.
Central banks in the euro area are therefore not obliged to exchange the equivalent value of a presented banknote for gold or other assets. You can always service all your euro liabilities, i.e. you cannot become insolvent ("illiquid") in euros. National central banks in the euro area, such as the Bundesbank, also accept euro coins back at face value and convert them into banknotes or account balances. Again, it cannot be exchanged for other assets.
2.2 Cash cycle in Germany
Specialty printers and mints produce the banknotes and coins and deliver them to the Bundesbank. The commercial banks or value service providers commissioned by them – private companies that carry out the transport of values such as cash – collect the cash from the Bundesbank’s branches. The money then enters the economic cycle via the banks to businesses and consumers. Conversely, participants in the economic cycle redeposit cash surpluses with commercial banks.
Banks and cash-in-transit companies can check banknotes for quality and authenticity – using machines tested by central banks in the euro area – and then reissue them directly. They return sorted-out and surplus cash to the Bundesbank.
Cash use in Germany
Although cash is steadily losing ground to cashless forms of payment, private individuals in Germany made 61% of their payments with cash in stationary retail outlets (including service stations and pharmacies). This corresponds to 38% of the turnover at the cash register. This is the result of a Bundesbank survey on "Payment Behavior in Germany 2020. While smaller amounts were mostly still paid with banknotes and coins, respondents increasingly used the card for contributions of 20 euros or more.
The advantages of cash lie u. a. in that it can be used quickly and anonymously, regardless of the use of technical or other aids. It can also be deposited back into an account at any time.
Preservation of cash quality
Damaged and soiled euro cash is replaced by the Bundesbank with circulating cash.
In the Bundesbank’s branches, the returned cash is checked for authenticity and fitness for circulation. Damaged and soiled banknotes are sorted out, shredded, pressed into briquettes and disposed of. In addition, counterfeit money is sorted out in the branches. To track down counterfeiters, Bundesbank experts analyze the counterfeit money they discover and store it so that it can be used as evidence in the event of a court hearing.
Bundesbank branches process around 15 billion euro banknotes a year. High-performance machines are used that can check 28 banknotes per second for fitness and authenticity.
Coins that are no longer fit for circulation are also withdrawn from circulation by the Bundesbank. They are devalued on behalf of the Federal Ministry of Finance and then sold to metal production sites. This is how the metal of the coins is recycled. Shredded euro banknotes and coins are replaced by the Bundesbank’s branches with circulating cash.
The life of a banknote depends primarily on its face value. Banknotes of small denominations (5, 10, 20, 50 euros) are already replaced after one to four years. Banknotes of large denominations (100, 200, 500 euros) sometimes have a life of well over ten years. Coins, on the other hand, wear out very slowly. They can often be used for decades.
The branches of the Deutsche Bundesbank supply the economy with euro cash. They exchange D-Mark cash into euros free of charge and for an unlimited period of time.
Replacement of damaged cash
In everyday life, cash is damaged unintentionally from time to time. It is, for example, torn, washed, accidentally shredded or eaten by pets.
For badly damaged euro banknotes that are no longer accepted in payment transactions, the national central banks of the euro area, including the Bundesbank, provide the holder with a replacement. However, this requires the holder to present banknote parts that are larger than half the banknote in total. Otherwise, it must prove that the rest of the banknote is destroyed. Banknotes stuck together fraudulently are not replaced.
The Bundesbank replaces damaged euro coins if the coins are worn or soiled by normal use in payment transactions.
2.3 The euro banknotes
Euro banknotes are available in seven denominations of 5, 10, 20, 50, 100, 200 and 500 euros. The different colors and sizes of euro banknotes make them easy to distinguish from one another. The higher the denomination, the larger the banknote.
The first series of euro banknotes is replaced by the Europa series.
The banknotes depict architectural styles from seven eras of European cultural history – in the form of windows, gates and bridges. These are modeled on the style of the era and do not really exist. The windows and gates on the front of each banknote are intended to symbolize the spirit of openness and cooperation in Europe. The corresponding bridges on the back of the banknotes are supposed to stand for the connection between the peoples of Europe and the rest of the world.
The first banknote series has been in circulation since the beginning of 2002. It was replaced by a new series between 2013 and 2019. The euro banknotes are the result of a design competition held as early as the mid-1990s, which was won by the Austrian Robert Kalina.
The first series of euro banknotes
Colors, architectural styles, dimensions
Gray, Classic, 120 x 62 mm
Red, Romanesque, 127 x 67 mm
Blue, Gothic, 133 x 72 mm
Orange, Renaissance, 140 x 77 mm
Green, Baroque/Rococo, 147 x 82 mm
Yellowish brown, iron and glass architecture, 153 x 82 mm
Purple, architecture of the 20. Twentieth century, 160 x 82 mm
The second series of euro banknotes
- Color: gray
- Style: Classic
- Dimensions: 120 x 62 mm
- Color: red
- Style: Romanesque
- Dimensions: 127 x 67 mm
- Color: blue
- Architectural style: Gothic
- Dimensions: 133 x 72 mm
- Color: orange
- Architectural style: Renaissance
- Dimensions: 140 x 77 mm
- Color: green
- Architectural style: Baroque/Rococo
- Dimensions: 147 x 77 mm
- Color: yellowish brown
- architectural style: iron and glass architecture
- Dimensions: 153 x 77 mm
The euro banknotes of the second series (Europa series)
In the second series of euro banknotes, the design is not fundamentally changed. However, the colors of the banknotes are stronger and more contrasting. The security features have been improved and new elements added. New motif is the mythological figure of Europa, whose portrait appears in the watermark and in the hologram.
The general features of the banknotes – such as the signature of the ECB President, the flag of the European Union and the abbreviations for European Central Bank in various European languages – have been retained.
There is no 500 euro banknote in the Europa series. Once issued 500- euro banknotes of the first series remain valid. This also applies to all other circulating banknotes of the first series.
The general characteristics of the second series of euro banknotes
The national central banks of the euro area are jointly responsible for printing the euro banknotes. The banknotes are produced by state-owned, but also by private specialist printers. To minimize costs, not every central bank has all denominations of notes produced. In fact, the national central banks are each responsible only for printing selected banknotes, which is determined annually.
Also with the banknotes of the European series is on their back the serial number. The horizontal long form consists of two letters and ten digits. The first letter gives information about the printer.
The origin of the banknotes of the Europa series
2.4 The euro coins
The individual member states in the euro area are responsible for issuing euro coins, whereby the total volume of coin issues must be approved by the Council of the European Central Bank. The Euro coins are available in eight denominations of 1, 2, 5, 10, 20 and 50 cents as well as 1 and 2 Euro. These coins issued for daily payment transactions are called circulation coins.
Unlike banknotes, coins have only one side, which has a uniform design across countries. The other side is decorated with individual motifs in each country. In addition to the 19 euro countries, Monaco, San Marino, the Vatican and Andorra can also issue euro coins with national side due to an agreement with the European Union.
The European coin side
old: version with 15 EU countries; new: adapted European side (from 2007)
No change for 1, 2 and 5 cent coins
The European side of the coin
The common European side of the coin symbolizes the unity of the European Union. It shows the coin value next to different stylized European maps resp. the globe ("Europe in the world") and twelve stars (based on the flag of the European Union). Due to the enlargement of the European Union, the motif of the European side of five coins (2, 1 euro and 50, 20, 10 cents) was adjusted in 2007. Instead of the 15 EU countries, the new coins from 2007 show Europe without national borders.
The uniform side of the coin was the result of a design competition held in 1997 under the auspices of the European Commission. The winner, Luc Luycx from Belgium, is honored by his initials "LL" on the coins.
The national coin side
The national coin side is designed individually by each country. Despite the variety of motifs on the national sides, the circulation coins of all euro countries are valid legal tender throughout the euro area.
The German coin side
1 and 2 euro federal eagle
10, 20, 50 Cent Brandenburg Gate
1, 2, 5 cent oak twig
The national sides of the 1-euro coin of the euro countries
Euro countries are allowed to change their national coin designs when a depicted head of state changes, which has already been the case for Belgium, the Netherlands and Spain.
The choice of coin metal was a matter of expediency and cost. In particular, the coin alloys must not be susceptible to rust and should wear little in use. Skin contact should also not cause allergies. It is also important that the metal value remains below the face value of the coin. Otherwise there would be a risk that the coins would be melted down and traded as commodities.
In Germany, five state mints still produce euro coins. This is indicated by the imprinted letter. The seemingly arbitrary sequence of letters can be traced back to the imperial government, which, immediately after the founding of the German Empire in 1871, alphabetically "numbered" all the mints in existence at the time.
Marks of the mints in Germany
The edges of the euro coins
The eight euro coins differ in size, weight, material, color and thickness. The 1 and 2 euro coins are composed of a coin core and a coin ring, each made of different metal alloys. Therefore, these coins are two-tone. Some features were introduced to make it easier for the blind and visually impaired in particular to recognize the different denominations. This is how the edge of each coin is designed differently.
Commemorative and collectible coins
On special occasions, euro area countries may also issue commemorative and collector coins with specially designed national coin sides. The 2-euro commemorative coins, like the 2-euro circulation coins, are legal tender in all euro countries. In Germany, for example, a special 2-euro coin has been issued annually since 2006, each with a motif dedicated to one of Germany’s federal states.
Examples of German 2-euro commemorative coins
2019 (70th anniversary of the Bundesrat)
2013 (50 years of the elysee Treaty)
In other countries also appear 2-euro commemorative coins with national motifs. In 2013, France and Germany issued a joint 2-euro coin as a sign of their friendship. In addition, common commemorative 2-euro coins appear on European anniversaries in the euro countries.
Common 2-Euro commemorative coins (German issues)
2007 (50 years of the EU)
2009 (10 years of economic and monetary union)
2012 (10 years of euro cash)
2015 (30 years EU flag)
In addition, there are euro collector coins with higher denominations, which are valid only in the country of issue as legal tender. According to the German law on coins, no one is obliged to accept German collector coins in the amount of more than 200 euros in one payment.
Euro collector coins are legal tender only in the country of issue.
Since the introduction of euro cash in 2002, the German government has issued several German euro collector coins each year. They have different nominal values (5 to 200 euros) and are made of different materials. Gold coins are available starting at a face value of 20 euros. An innovative series of coins was launched in 2016: coins with colored and translucent polymer ring. The German Euro collector coins are legal tender only in Germany.
German euro collector coins can be purchased from the German Mint (previously: Official Sales Office for Collector Coins (VfS)) at issue prices that are higher than the face value due to special qualities and packaging. At face value you can buy 5, 10 and 20 euro collector coins (except gold coins) at the branches of the Deutsche Bundesbank.
Examples of German collector coins 2019
Face value, material, motif/series
5 euro, copper/nickel, polymer, temperate zone/climate zones of the world
10 Euro, Copper/Nickel, Polymer, Moving in the air/air
20 euro, gold, peregrine falcon/domestic birds
20 Euro, silver, 100 years women’s suffrage/20-Euro collector coins
50 Euro, gold, fortepiano/musical instruments
100 Euro, gold, Speyer Cathedral/UNESCO World Heritage Site
2.5 Detecting Counterfeit Money Thanks to Security Features
To ensure confidence in the cash in circulation, banknotes and coins are provided with a number of security features to protect against counterfeiting. In addition, the production and circulation of counterfeit money is punishable by law. Anyone who knowingly passes on counterfeit banknotes or coins that have been planted on them also commits a criminal offense. Since there is no substitute for counterfeit money, everyone must check when accepting cash that they are accepting only genuine banknotes and coins.
Central banks in the euro area – including the Deutsche Bundesbank – are keeping a close eye on new developments in printing and reproduction technology. They analyze the counterfeits that occur in their country, keep them in safe custody and enter the results of their investigations into a Europe-wide database. Central banks work closely with national and international law enforcement agencies to prevent and combat counterfeiting.
Security features of the euro banknotes
Security features allow euro banknotes to be checked for authenticity.
On the basis of the security features, any attentive cash user can detect counterfeits even without the use of aids. The banknotes of the Europa series contain security features at the highest level of banknote technology. The Europa series is characterized by the portrait of the mythological figure of Europe, which appears against the light – together with the value numeral – in the new watermark and the new hologram.
As the value of euro banknotes increases, so do the number of security features. Banknotes of 20 euros or more can be checked for authenticity not only on the basis of the features common to all euro bills, but also on the basis of additional security features.
Security features of the euro coins
Even coins are equipped with security features. On genuine coins, the coin image stands out clearly and tangibly from the rest of the coin surface. All contours are distinct and sharp and clearly visible. This also applies to the edge of the coin.
In the case of the 2 euro coin, the embossed writing on the edge of the coin makes counterfeiting even more difficult. The two-color design of the 1- and 2-euro coins also increases protection against counterfeiting.
Authentication by "feel-see-tilt
With a little attention, everyone can use the security features to protect themselves from accepting counterfeit banknotes. Because banknotes can be checked quickly according to the "feel-see-tilt" principle.
With about seven counterfeits on 10.000 inhabitants in 2020, that is around 58.800 counterfeit banknotes, the amount of counterfeit money in Germany is extremely low. The 20- and 50-euro banknotes were most frequently counterfeited. Counterfeit coins occur even less frequently. Around 89% of the approximately 44.800 counterfeit coins in 2020 were 2-euro coins.
Behavior with counterfeit money
If you suspect counterfeit money, you should follow some rules of conduct: Comparison with a genuine bill makes it easier to check a suspicious bill. Suspicious banknotes should be touched as little as possible, however, so as not to smudge fingerprints.
Money clearly identified as counterfeit must be immediately handed over to the police with details of its origin. If known, information on the person who issued the counterfeit money is also helpful. Such responsible behavior supports the investigations of the police.