As the world continues to adopt electronic methods of payment, Switzerland embraces the regular use of paper currency
By Joshua McMorrow-Hernandez for Coinweek …….
At a time when the European Union is encouraging its member nations to eliminate high-denomination banknotes to help discourage criminal use of paper currency, independent Switzerland is keeping its 200- and 1,000-Franc banknotes. It may be tied to Swiss culture; monetary laws in Switzerland permit a degree of secrecy in the banking system. The public embraces this policy, with most citizens choosing to use banknotes and coins for many of their transactions.
Currently, the nation is unveiling the first changes to its paper currency in nearly 20 years, and despite major modifications to the currency’s physical size and security features, all denominational values will remain intact.
Swiss paper currency will be reduced in size, incorporate new security features and offer new designs.
The first of the new small banknotes, the 50-Franc note, will be released on April 12.
The rest of the denominations, including 10, 20, 50, 100, 200, and 1,000 Francs, will follow over the next few years. The changes make Swiss currency safer to use and more convenient for wallets and purses, which seems like the perfect move for a population that loves to use paper currency.
According to a study by the Bank for International Settlements, the ratio of card payments to gross domestic product is just 10 percent in Switzerland, versus 34 percent in the United Kingdom and 25 percent in Sweden.
“Cash is property and cash is freedom,” Manuel Brandenberg told the press. Brandenberg is a Swiss lawmaker who once proposed a 5,000-Franc note. “It empowers the individual, because it’s tangible wealth.”
Brandenberg is proposing a national law that further establishes the current paper currency denominations; presently, only the Swiss National Bank determines which denominations are issued as paper currency. Brandenberg’s aim is to ensure high-denomination notes remain intact even as the rest of the continent eliminates high-value paper currency.
“We want to guarantee that cash remains in force,” he said. “If it’s anchored in the law, it’s harder to change.”
Many Swiss retailers refuse to accept plastic, even as cash is slowly fading away in other European nations and travelers from abroad are more likely than ever to use plastic cards to pay for lodging, food, souvenirs, and other purchases. According to former Finance Minister Eveline Widmer-Schlumpf, who voiced the matter before the nation’s parliament in 2014, about 20 percent of Swiss purchases–including transactions involving large sums of money–were paid for using cash.
Switzerland, a nation noted for its dedication to neutrality, is taking sides when it comes to money laundering. In 2014, the Swiss Parliament took cues from the international community and imposed new regulations on high-value transactions. Swiss law placed a 100,000-Franc limit on anonymous cash transactions – a move that will help combat criminal activity at a time when terror concerns, black market dealings, white-collar offenses and other misdeeds appear to be increasing in Europe and around the world.