The European Central Bank is set to decide on Wednesday the fate of the €500 banknote, which many people associate with money laundering, the black market and terrorist financing.
The violet-coloured bill, the largest denomination banknote in the single currency area and physically also the bigger than the five other euro notes, is on the agenda of a meeting of the ECB’s governing council.
EU finance ministers call for restrictions on €500 note over crime fears
Notwithstanding any surprises, the council is likely to vote to stop issuing them, as the bill is believed to be favoured by criminals for moving large sums of money around without the authorities knowing.
But its possible abolition is raising hackles in countries such as Germany.
“Such notes are the preferred payment mechanism of those pursuing illicit activities, given the anonymity and lack of transaction record they offer, and the relative ease with which they can be transported and moved,” according to a recent Harvard University study.
“Organised crime isn’t stupid. Most money is laundered without cash via bogus companies,” said Friedrich Schneider, an expert on the shadow economy at the University of Linz in Austria in interviews to a number of German media recently.
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