Thursday, July 6, 2023
Parents often repeat the phrase "Money doesn't grow on trees" when their children ask them for a few euros for their treats. A statement that, moreover, is as real as life itself, as is the fact that euros can now also bring flowers and plants to life. That does not necessarily mean that planting 10 or 20 euro bills and watering them will multiply them like the miracle of the loaves and fishes. What can happen is that they may wear out and become unusable, then they will be useful for another life of money as fertilizer.
Currently, 29.5 billion banknotes and 145 billion coins pass from hand to hand and from wallet to wallet in the 20 countries that have the euro as their official currency. "The average life is about seven years," replies Carlos Gonzalez, head of the agent and manufacturer relations division at the Bank of Spain.
29.5 billion banknotes in circulation in the Eurosystem
Every week, trucks arrive at the national banking supervisor with hundreds of boxes full of dirty, worn, or torn banknotes. "The Eurosystem has well-defined features for taking these banknotes out of circulation," says Beatriz García, deputy director of the Bank of Spain's cash department. "They are fed into a machine that is capable of examining 33 banknotes per second," the spokeswoman adds.
"The average life of a banknote is about seven years" Carlos González, head of the Banco de España's agent and manufacturer relations division.
A detailed analysis of 1,980 bills per minute or 118,800 per hour. "You don't have time to look at them," González replies. The majority return to the monetary supply and "18% are destroyed," explains the deputy director of the Bank of Spain's cash department.
Fertilizer for the garden
However, this departure from the organization's facilities is not a final farewell. "The rules are very clear: no banknote can go to landfill or be incinerated without energy recovery," González states. Precisely, making use of them is essential.
Banknotes that do not return to the wallets of European citizens become "waste and have to be of a specific size," says the head of the Spanish banking supervisor's agent and manufacturer relations division.
"18% of the banknotes that return to the Bank of Spain with a defect or soiled banknotes are destroyed" Beatriz García, Deputy Director of the Bank of Spain's Cash Department
Cut into small pieces, these banknotes, which "83% are cotton fibers and starting this year will be totally sustainable," leave the Bank of Spain's facilities on their way to their new life.
The conversion of banknotes into compost is a solution widely used by other national banks. "Colombia uses them to regenerate its native forests and the U.S. Federal Reserve has also done tests," explains the head of the Spanish supervisor's agent and manufacturer relations division. "We also have some projects, but most of our waste is packaged for other industries to make use of the energy the banknotes' value," she adds.
However, the circulation of European banknotes begins when they are produced. The list of ingredients of the European Union's money is as follows: cotton fibers, aluminum polymers, ink, and other substances. In percentage terms, cotton is dominant, since 80% of the euros in banknote form are cotton, and "in the latest series, the emphasis has been on sustainability," González notes. "Let's be clear. You don't grow cotton to make euros," she adds.
"Cotton is not grown to make banknotes. We use the surplus from the textile industry," Carlos González, head of the division of agent and manufacturer relations at the Bank of Spain.
For Spain, the banking supervisor has an agreement with the textile sector "to use discarded fibers and reuse them in money production," says the head of the division of agent and manufacturer relations at the Bank of Spain. By 2023, Spain has gone from 80% sustainable cotton to 100% and "40% is fair trade."
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