Based on the national central banks’ (NCBs’) needs for banknotes, the ECB entrusts the NCBs with the task of producing a predefined quantity of banknotes. The production of a given denomination is generally assigned to one or several NCBs. Once the banknotes are produced, an allocation takes place between the NCBs according to their respective needs in terms of denomination and quantity.
The BCL is the issuing authority of banknotes in Luxembourg; it puts banknotes on the market according to the needs of the national economy.
In accordance with its Organic Law, the BCL also puts on the market Luxembourg euro coins, the issuing authority of which is the State of Luxembourg. Pursuant to an agreement with the State, the BCL is in charge of producing Luxembourg euro coins.
The banks source euro banknotes or coins from the BCL according to their customers’ needs. The BCL insures the maintenance of the credit circulation by authenticating deposited banknotes and by differentiating between suitable banknotes, to be recirculated, from damaged ones, which are destroyed.
The Counterfeit Monitoring System (CMS), a European system aimed at monitoring counterfeit banknotes, was established. The BCL participates in the CMS by contributing to an efficient detection of counterfeits.