Banknote is a promissory note, made by a bank, which is payable to the bearer on demand. It is also known as a ‘bill’ or a ‘note’. Historically, the banknotes were issued by the commercial banks but now, the production and distribution of new banknotes, and destruction of the unfit banknotes is the responsibility of the central bank of the respective countries. One of the crucial responsibilities of the national banks is to ensure the adequate confidence of the citizens in their nation’s currency. A country’s monetary policy serves the purpose of designing strategies related to money supply in the economy.
Globally, the demand growth for banknotes remained robust with volume of circulating banknotes growing decently and exceeding GDP growth rates in several nations. The global banknote market is highly dominated by production of banknotes with security threads.
In terms of geographical areas, the U.S. and Eurozone are major contributors to the global banknote market supported by their economies and high production volumes and values. However, the production volume of Euro banknotes continued to decline in the previous year.
The global banknote market is expected to grow in future due to improving economic conditions, rising global population and growing number of ATMs. In the recent years, the banknote market has gone through several reforms. A new concept called ‘security by design’ has been introduced by banknote suppliers. Through this concept, new designs of banknotes would be introduced including new safety features, brighter color etc. Despite all the growth factors, there are some factors which can hinder the market growth including counterfeiting of banknotes and rapid growth of electronic payments.
The global banknote market is majorly dominated by De La Rue Plc. and Giesecke & Devrient Group. De La Rue is increasingly investing into developing innovative and more secure features for bank notes. Commercial bank note market is also dominated by De La Rue Plc. However, the scenario is quite different in polymer substrate market. Only two companies, CCL and De La Rue, hold the absolute share of the polymer market in which CCL holds the lion’s share.