NFC in banknotes

Cash status in Germany

In 2019, the value of all cashless transactions in the German retail sector was as high as the value of cash. Not least for this reason, the abolition of cash through digital forms of payment, such as card payment, or paying with a smartphone is a recurring theme. The younger generation in particular carries significantly less cash on average than older people. The so-called cashless trend comes mainly from the North; Sweden, for example, wants to abolish cash completely by 2030.

Nevertheless, 48% of people in Germany still say that they pay mainly with cash. Many appreciate above all the anonymity of this means of payment. It will probably be several years before cash is completely replaced by electronic payment methods - if it happens at all. Protection against cash counterfeiting is therefore not diminishing in importance; on the contrary, it is becoming increasingly important to counter new criminal tactics. Modern technology can help to make cash forgery-proof.

Forgery-proof cash

Modern banknotes are already protected against counterfeiting in many ways. Among other things, they are provided with tangible features that are invisible and visible to the eye. Furthermore, more and more cash registers are automatically checking the banknotes for security criteria, so that counterfeit banknotes are already conspicuous during the payment process.

In addition to these visual and haptic features, other strategies are also being considered to make cash forgery-proof. To this end, banknotes could be digitized and provided with other technical features. In the following we will explain which features these are and how they work. We will also discuss the role of NFC and RFID in protecting banknotes against counterfeiting.

Digitised banknotes - What is possible?

The basic idea is to provide banknotes with digital features that can be read and processed electronically. This would give a banknote a data memory with verifiable content. Information about the age and origin of the banknote could be stored and encrypted and then read out by cash register systems and counters designed for this purpose.

A technology should make precisely this possible and is currently being developed. Microscopically small, physicochemical structures serve as digital storage elements. Among other things, these structures should be embedded directly in the printer ink and be able to store data between 64 and 128 bytes in size. However, since such molecular switches react to light, the current challenge is to prevent malfunctions caused by the influence of natural daylight.

Cash and NFC

At first glance, NFC technology also appears to be a suitable means of making cash counterfeit-proof. NFC tags are used, for example, in stickers, which are sometimes very flexible and waterproof and can withstand high temperatures even after multiple wash cycles. By processing into the material, these NFC chips are designed for industrial use (NFC for industry). However, this resistance is not enough to survive in a banknote. In a life cycle of usually 5 years, banknotes have to withstand rough handling, such as crumpling, without any problems.

A prerequisite for the use of tiny NFC/RFID chips in banknotes would therefore be, on the one hand, the lowest possible production costs and, on the other, extremely high robustness against external influences. Banknotes have to withstand chemical attacks, cleaning at up to 90 degrees and enormous heat (up to 180 degrees). These and other demands on a banknote make NFC or RFID technology currently not a suitable method for making money forgery-proof. Due to its ease of use, NFC tends to show its strengths in contactless / cashless payments. In combination with bank cards and smartphones, the use of NFC technology can make payment transactions faster and more secure.


Although the trend shows that younger people in particular are paying less and less with cash, coins and notes will probably continue to be a common means of payment in Germany for a long time to come. This goes hand in hand with the demand for modern and comprehensive counterfeit protection, which must be guaranteed above all by constantly new technologies.

NFC / RFID is going in the right direction, but is currently not robust enough for practical use in a banknote and is too cost-intensive. Instead, other technologies are being developed that are specifically designed for the special requirements.

Further information

Erstellt: 20.08.2020 / Aktualisiert: 16.11.2020 2020-08-20 2020-11-16