The National Bank of Denmark (Danmarks Nationalbank) has announced their decision to discontinue the production of both coins and banknotes citing the prohibitive costs of producing both elements of currencies and the continuing lack of demand for coins and banknotes within the Danish economy. The National Bank does not see a reverse in this trend and as such, they made the decision to outsource the production of both from 2016. Additional or underlying factors such as the declining use of banknotes for transactions in favor of debit and electronic payment options, more effective re-circulation of banknotes and coins within the economy, and improved banknote quality overall resulting in extended usability has resulted in the declining level of production of Danish Kroner banknotes and coins at their Central Copenhagen facility. The Danmarks Nationalbank has stated that due to these improved conditions and decreasing demand for cash in the economy, it is no longer economical for the institution presently and will not be economical in the future to continue with the production of notes and coins.
Like a number of other central banks, the Danish National bank will outsource these functions to external service providers. This decision is expected to yield total savings of 100 million Kroner or $17 million USD over a four year period – or up to 2020.
The minting of coins in Denmark is more than 1000 years old with the first national coins believed to have been minted in 995 AD – a commemorative coin marking this anniversary was issued in 1995. The outsourcing for the production of coins may mean the end of the Royal Mint of Denmark (Den Kongelige Mønt) whose rich history spans as far back as the early 16th century when it was officially established by the Danish Crown for the production of national coinage. Currently by law, the Royal Danish Mint is the only company allowed to mint Danish coins. The Danish government owns the Mint as an entity belonging to the Danish National Bank. In 1975 the Danish government placed the Royal Mint under the control of the National Bank and in 1978 the mint moved to a purpose-built state-of-the-art facility located in Brøndby, a suburb of Copenhagen. In March 2012 the offices of the mint were again relocated to Copenhagen within the Danish National Bank building in Central Copenhagen. This location accommodated both the production of both banknotes and coins.
Danmarks Nationalbank states they will continue to be the Danish banknote and coin issuing authority and will retain its expertise within banknotes and coins. The actual production of banknotes and coins will be transferred from their internal department & production to external service providers.