1000 bank note3/23/2023 ![]() ![]() It evades something else, too: Switzerland’s negative interest rates. For some, he adds, transacting in cash may also come with the added allure of evading some taxes. “It’s built into the culture,” Kyle says. It’s consistent, he says, with the long Swiss tradition of bank secrecy and confidentiality. Swiss people, on the other hand, like to do things in a manner that can’t be traced by other people.” “In China, people are less concerned with the idea of privacy and more concerned with convenience. “The Swiss culture is running in a different direction than, say, Chinese culture,” Kyle says. The Swiss like the physical money and they use it. Groceries, gasoline, fashion, fine dining, it’s all cash-driven. They regularly go to the local post office to shell out banknotes to pay utility bills. It’s not unusual for a Swiss consumer to count out a stack of 1,000-franc and 100-franc bills for big-ticket stuff like cars, mortgage payments or appliances. That culture is broadly anti-debt, less reliant on the ease of credit cards and forms of financing that are popular in the U.S. “They have a culture built around banking and thinking about the value of money,” he says. The stereotype of the Swiss people is that they are efficient and mindful about money, Kyle says. The reasons why tell a story of Swiss money. ![]() Just look at Sweden, where the central bank is predicting the country will be “cashless” within five years, amid the growing prevalence of mobile and other digital payments.īut while cashlessness may suit Sweden, where just 1 percent of the economy is cash-driven, Kyle says Switzerland isn’t ready to break up with its paper money (which isn’t actually paper at all it’s polymer). The decision reflects another trend being bucked in Switzerland, as well: the trend toward cashlessness. “Larger banknotes are very useful in organized crime.” Smith Chair Professor of Finance at Maryland Smith. “If you think about filling a suitcase with cash, you can put a lot more money in there if you have larger denominations,” says Albert “Pete” Kyle, the Charles E. And in large denominations, it’s relatively simple to move around. ![]() Federal Reserve is under similar pressure to discontinue the $100 banknote, with critics arguing that these big-money banknotes make life too easy for criminals. The European Central Bank this year is halting the issuance of its highest-denominated banknote, the 500-euro note, a move first announced in 2016. Smith School of Business Center for Financial Policy and a professor of international economic policy at UMD's School of Public Policy.īy launching the new series of its large-denominated banknote, the Swiss National Bank is bucking a trend shared by the world’s major central banks. “It’s really a striking thing for the Swiss central bank to do,” says Phillip Swagel, a senior fellow at the University of Maryland Robert H. At 1,000 Swiss francs (roughly equivalent to $1,000), the banknotes are among the world’s most valuable. It’s not because the new bills are loaded with futuristic security features (although those are pretty cool), it’s because of their controversially large denomination. SMITH BRAIN TRUST – Switzerland’s newest banknote begins circulating this week, and it’s an attention-grabber. ![]()
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