Market Report
The Lifecycle of Banknotes to 2030
Technology and security take leading role in banknote lifecycle
Despite the growing dominance of digital wallets, cryptocurrencies, and central bank digital currencies (CBDCs), banknotes will remain indispensable for economic resilience, financial inclusion, cultural identity, and privacy, according to a new report from the market intelligence division of Smithers.
The new report, The Lifecycle of Banknotes to 2030, delves into the lifecycle of a modern banknote from its conceptual blueprint design to its eventual circulation withdrawal and mode of destruction and finds that near 2030, the banknote lifecycle will be greatly influenced by the integration of advanced technology. Evolving public needs, and the prioritization of sustainability, and accessibility will also shape the market over the next five years.
Smithers data shows the global banknote printing market is expected to increase in value to $17.1 billion in 2029, a CAGR of 5.3% from 2024.
The digital universe
The growing use of digital wallets has led to a decline in the frequency with which banknotes are used in daily transactions. As a result, physical notes experience less wear and remain in circulation for longer periods. In some cases, individuals and businesses are stockpiling cash, treating it more as a store of value than a medium of exchange. This behavior alters the recirculation dynamics and complicates the forecasting of replacement needs.The introduction of central bank digital currencies (CBDCs) presents a structural shift in the role of physical cash. While CBDCs are unlikely to replace banknotes entirely in the short term, their emergence may reduce the overall volume of cash in circulation. Banknotes may become more symbolic or serve specific roles, such as during emergencies or for individuals without access to digital infrastructure.