Good money and your central bank

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Good money and your central bank

The future of bank notes

Now let’s get more concrete, starting with the simplest form of money—cash.

Cash has undeniable benefits. It’s simple, widely accepted, inexpensive to use and reliable. It works during power failures and internet outages and is not vulnerable to cyber attack. About 80% of Canadians—perhaps surprisingly, both old and young—and 96% of small- and medium-sized businesses use cash.

While the use of cash for daily transactions has declined, cash remains important to many Canadians. It accounts for one in five transactions at the point of sale, and the demand for cash continues to grow with the economy.

To be good money, the bank notes we issue have to be easy to authenticate and hard to counterfeit. We issued our first series of notes in 1935, shortly after the Bank was founded. That first series of notes had raised ink and small green dots scattered in the paper, which made the notes hard to counterfeit at the time. But threats have evolved.

Our newest bank note will be issued in early 2027. The new vertical $20 will showcase an innovation in anti-counterfeiting security. We’ve used 3-D features before, and we’ve used features that shift when the note is moved. Our $20 note will combine these two technologies for the first time. I wish I could tell you more, but you’ll have to wait for the unveiling next year.

What I can tell you is that the new $20 note will feature King Charles III on the front and the Canadian National Vimy Memorial on the back. A new $5 note will follow soon after, picturing Terry Fox. And work has begun to develop larger denominations—the $50 and the $100—to build on the security features of this new series of notes.

To be good money, cash also needs to be accessible. And I want to assure you that even as other forms of payment are growing faster than cash, we are committed to ensuring Canadians continue to have access to cash.

https://www.bankofcanada.ca/2025/12/good-money-and-your-central-bank/

Money you can count on

https://www.bankofcanada.ca/2025/12/money-you-can-count-on/

Thank you suretteda for finding these remarks by Tiff Macklem from December 16th.  Getting information straight from the Bank of Canada is good for our forum.

Later in his remarks, Mr. Macklem adds there are about 3 billion bank notes in circulation worth about $120 billion.  Economists know that this $120 billion is, in essence, an interest free loan provided by Canadians rather than paying for more interest bearing bonds.  Great!

Here is my brief capture presenting both of his points.  The table using Bank of Canada data shows the value of circulating currency by denomination for the past 4 years along with the number of bank notes in circulation.  We collectors may admire the bank's rigorous accounting for including the outstanding $25 and $500 notes!

We can see the total value and therefore number of notes continues to climb year after year - the demise of bank notes is overstated.  Of course, $1s, $2s, and $1000s continue to drop as they are redeemed and not replaced.

This information offers a starting point for someone else looking at the number of circulating notes by denomination versus the frequency of new prefixes reported in our SNDB.

Food for thought,
JBN