Coping with the Euro crisis

Roger Macdonald unravels the tangled web of the Euro currency.

The origin of every Euro banknote, indicated by a letter of the alphabet in front of its serial number, hitherto has been a matter of supreme indifference for holidaymakers. But the crisis in the Eurozone means that some Euro notes could be discounted in value or rejected altogether, if one of its members goes bankrupt.

The risk is no longer confined to Greece because Spain, too, is now borrowing money to fund its debts at an unsustainable rate of interest.

So when is a Euro not a reliable Euro?   When its serial number starts with a ‘Y’, and perhaps with a ‘V’.

Which is the only safe Euro?  One whose serial number begins with an ‘X’.

The most vulnerable banknotes are still those issued in Greece itself, which start with a ‘Y’. However the contagion is spreading to other countries and of these, Spain now looks the most vulnerable; its notes have serial numbers prefaced by a ‘V’.

At the other end of the scale is Germany, whose notes can be identified by the letter ‘X’, seen by many as the only secure haven in the Euro currency.

The Euro symbol and EurotowerBanks across the Euro zone are presently obliged to accept all Euro notes at their face value, regardless of their place of origin. But they are not obliged to distribute only those notes that a customer considers safe. In practice it is extremely difficult to persuade banks to supply just those Euros bearing the letter ‘X’, or at least not to supply those with a ‘Y’ or a ‘V’.

Except, ironically, in Germany itself.  Back in 2008, at the first hint of a financial crisis, ordinary Germans began to reject Euros issued in Greece, Spain, Portugal and even Italy. They were allowed to exchange them for ‘German’ Euros by their German banks.

Many regular UK travellers have accumulated a large number of Euros over the years with the presumption that they could always be used on future trips to Europe. The best advice seems to be to grade these notes according to their country of origin, and spend those printed in Greece, Spain,  Portugal (‘M’) , and perhaps even Ireland (‘T’) and Italy (‘S’), as quickly as possible.

If this sounds like scaremongering, remember that this crisis is on an unprecedented scale. When the Euro currency was launched by eleven countries in January 1999, it seemed unthinkable that the Euro could be anything other than completely secure. However the fact that notes issued by individual nations have always remained relatively easy to distinguish, does imply that a secret contingency plan exists for devaluing or disowning Euros produced by countries in default.

Anyone going on holiday outside the Euro zone should not take a significant number of Euros of any origin at all, as a Greek or Spanish default would undoubtedly trigger an economic turbulence on an unprecedented scale. In such circumstances the Euro would certainly lose a significant part of its value against other currencies.

Sterling would also be weakened, as so much of UK’s trade is now with countries within the Euro zone. The only easily accessible currency not likely to be immediately affected is the US Dollar. Taking dollars on holiday everywhere, but to the most vulnerable Euro zone countries in particular, may be the only prudent solution.  The alternative is to risk returning home with a wallet full of Euros that include some worth less than the rest, or prove to be no longer negotiable at all. 

However, this is all uncharted territory.  No one really knows what will happen.  Even the dollar may not be entirely safe. When the US federal bank lost its charter in 1836, local and state banks sprang up everywhere. They issued paper currency that was not backed by gold and many collapsed in the economic depression that followed.  The dollar had different values in different states, influenced by people’s judgment on whether their money was secure. 


D - Estonia
E – Slovakia
F – Malta
G – Cyprus
H – Slovenia
L – Finland
M – Portugal
N – Austria
P – Netherlands
S – Italy
T – Ireland
U – France
V – Spain
X – Germany
Y – Greece
Z – Belgium

Note: ‘R’ is allocated to Luxemburg but their notes bear the code of the countries of the central banks where Luxemburg’s banknotes are produced.  ‘J’ was allocated to the UK and ‘K’ to Sweden but both countries have declined to join the Euro. Other countries where the Euro is the prime currency are Andorra, Kosovo, Montenegro, San Marino and the Vatican City.

For more on the vulnerability of the Greek Euro:

"What if Greece had to get a new currency?"
What would happen if a eurozone member, such as Greece, had to get a new currency, asks BBC Radio 4's Chris Bowlby.
Read more - source BBC


Roger Macdonald is the founder of three long-running BBC travel programmes - The Travel Show, Breakaway and Going Places. His many books include Trouble-Free Travel, the result, he says, of making every conceivable mistake on his own travels.

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Other Members' Thoughts - 2 Comment(s)

  • pink
    about 2 years ago
    would it be possible to add the date this article was written? better still, what about an update with anything new to watch out for in 2016?
  • TheProwler
    over 5 years ago
    Very interesting and eye opening information... thank you.
    I don't think that I would be the only one who would be ignorant to the points raised in this article.