A new technology developed in the Canary Islands aims to boost the security of euro banknotes as they undergo a redesign. The proposal from a research team at the University of La Laguna is under review by the Bank of Spain for potential use on upcoming euro notes. The goal is to identify an innovation that best fits the needs of the currency and its users in North America and Canada as well as Europe.
Led by physicist Jorge Méndez, whose expertise centers on photonics and nanotechnology, the project sits within a collaboration with the Bank of Spain as part of the MAGEC-REEsearch initiative, with Méndez serving as principal investigator. This project specifically seeks new applications for rare earth elements, a group of 17 luminous chemical elements valued in telecommunications and renewable energy. While Méndez has traditionally focused on locating rare earth deposits in the Canary Islands, he remains open to pursuing other research avenues. He emphasizes that the collaboration demonstrates how science can serve communities directly, a sentiment he repeats to emphasize the broader social value of the work [Citation: University of La Laguna; Bank of Spain].
Rare earths are already used to safeguard euro banknotes. In particular, europium has played a pivotal role in protecting the European currency from forgery. Fluorescent molecules in this compound absorb ultraviolet light and re-emit energy in a way that can quickly reveal whether a note is counterfeit when viewed under the right conditions [Citation: ULL research team; Banco de España].
The La Laguna research group has partnered with the Bank of Spain’s Cash Innovation and Technology Division since 2021, working to ensure that cash transactions stay secure. However, ULL is not the only center pursuing new technologies for euro notes, as Méndez notes that competition comes from other national R&D centers across the country [Citation: Banco de España; ULL].
Participants within the ULL team include postdoctoral researchers Pablo Acosta and pre-doctoral scientists Miguel Medina and Sheila Torres. On the Bank of Spain side, coordination has been led by Fernando León, head of the Cash Innovation and Technology Division. Through this collaboration, the teams have coordinated, studied results, and presented technical proposals to the Bank of Spain on a regular basis [Citation: Banco de España; ULL].
Separately, researchers from the Institute of Materials Science Madrid (ICMM-CSIC) announced their own collaboration with the Bank of Spain to achieve banknotes that are more durable, sustainable, and secure [Citation: ICMM-CSIC; Banco de España].
Two-Thirds of Spaniards Prefer Cash
This cross-border process mirrors a move across the European Union toward innovative, secure cash. The European Central Bank’s Governing Council has committed to issuing modern, secure notes and has announced a redesign rollout beginning in 2026. Méndez notes that euro notes across the euro area can contain as many as 100 different security features, from watermarks to more sophisticated elements visible only with specialized equipment used in high-security facilities [Citation: ECB; Méndez].
Despite the growth of cashless payments, cash remains a favorite in Europe, with more than half of consumers still using cash for purchases. The SPACE study of 2022 shows notable country differences: some nations rely heavily on cards, while others, like Malta and Slovenia, still use cash in only a minority of transactions. In Spain, about 66% of the population prefers cash over electronic payments according to data from the European Central Bank. Cash is most commonly used for vending machines, restaurants and hotels, and everyday shopping [Citation: SPACE 2022; ECB Spain].
Even with a trend toward cashless options, demand for cash remains tied to its role as a store of value. As part of the Eurosystem’s 2030 cash strategy, concrete steps are being taken to keep cash a viable payment method well into the future, even if a digital euro is introduced later [Citation: Eurosystem; Méndez].
Cash’s Role as a Store of Value
Canary Islands Economic Outreach
During this period, the Bank of Spain’s Cash Division has conducted information-sharing activities about euro note technologies, with leadership from Fernando León and Rubén Ortuño at the SHIFT2022 light applications conference hosted by ULL in October 2022. They are also slated to participate in further outreach about banknote technologies in collaboration with the University of La Laguna this year [Citation: SHIFT2022; Bank of Spain; ULL].
To educate the university community about financial literacy, the Bank of Spain, through its Santa Cruz de Tenerife branch, and ULL are also collaborating on outreach activities, such as the October 2023 event titled Finance for Everyone, organized with the University Institute of Business and the La Laguna Economic and Social Forum. These joint efforts will continue to deepen public understanding of economic and financial matters across society [Citation: Bank of Spain; ULL].