Index – Economy – György Matolcsy said whether 50,000 HUF banknotes will be introduced

In Hungary during 2023, the average value of cash payment transactions was 3,597 forints, even the amount of 20,000 forint banknotes in circulation decreased, therefore the introduction of the 50,000 forint banknote would lead to payment difficulties and an immediate denomination change problem – read György Matolcsy to the president of the Magyar Nemzeti Bank In the reply addressed to the member of Parliament of Előd Novák (Mi Hazánk), which was titled “When are they willing to withdraw the inflated five-forint notes and introduce the fifty-thousand resi?” given to his question.

“The central bank determines the denomination composition of banknotes and coins in circulation on the basis of complex criteria that take into account the operation of all actors in the cash supply chain, in which the analysis of retail payment methods and the examination of the role of individual means of payment in circulation are given special weight,” said György Matolcsy, then added:

In this regard, it can be stated that although inflation has an effect on the purchase value of individual denominations, it has had a negligible influence on residential payment habits in the last nearly two years.

Determining or changing the denomination structure of the means of payment in circulation cannot be judged on the basis of narrow, momentary criteria examining the current value of metal prices, the governor of the central bank said.

The new denomination would cause difficulties

The president of the Magyar Nemzeti Bank drew attention to the fact that it is considered a particularly important aspect regarding the initiated decision to introduce the HUF 50,000 banknote that the NAV online cash registerin its database (OPG) according to registered data

Research on online cash registers and residential payment habits shows that cash is often used for smaller purchases.

It follows from all of this that it would be very difficult to pay cash purchases of average value with HUF 50,000. The possible use of HUF 50,000 banknotes would result in an immediate denomination change problem in most payment situations

– stated György Matolcsy, adding that “in 2023, compared to the previous year, the amount of 20,000 forint banknotes in circulation decreased slightly, by 0.7 percent, and only in the case of the 500 and 1,000 forint denominations we experienced a marked – 5.1 percent , and 5.8 percent – stock expansion”.

According to the president of the central bank, inflation did not increase the demand for banknotes of the highest denomination, but only for the smallest ones. The banknote and coin denominations in circulation fulfill their cash circulation function properly, no disturbances or circumstances can be identified in the cash cycle that would justify intervention in the current denomination structure.