Which banknote do Albanians use the most? - SCAN Analysis: What do banknotes reveal about the Albanian economy?
Every day, Albanians pay with cash for coffee, food, or small services. But which banknote changes hands the most often? And which one carries the greatest weight of physical money in the economy?
Bank of Albania data shows that the answer is not as straightforward as it seems and varies depending on how cash use is measured.
If we talk about the number of banknotes in circulation, that is, the denominations that are most frequently used in everyday payments, it turns out that the most present are the 1,000 and 2,000 lek banknotes. They are the denominations that circulate most frequently in ordinary transactions of citizens, in small purchases and routine payments.
But the picture changes when the analysis is done in monetary value. According to the structure of cash in circulation, the banknote that carries the greatest weight is the 5,000 lek note. Not because it is used more frequently than other denominations, but because it represents a higher value per unit and concentrates a significant portion of the physical money in the economy.
Bank of Albania reports show that the structure of banknotes has gradually changed, but without being overturned, despite strong shocks such as the pandemic, rising inflation, or the introduction of the 10,000 lek note. Even after these developments, the 5,000 lek note continues to remain the mainstay of cash in value.
At the same time, the total number of banknotes in circulation in Albania has remained relatively stable. In the last five years, it is estimated at around 150 to 160 million pieces, indicating that changes are not occurring in quantity, but in the way cash is used.
One of the main reasons is related to the gradual shift of small payments towards electronic means. Small denominations, such as 200, 500 and 1,000 lek, are used less today than before, while bank cards and transfers are replacing cash in frequent payments. This explains why the number of banknotes in circulation remains stable, while their role in the economy is being reshaped.
Another trend highlighted by the reports is that banknotes are “living” longer. They are being replaced and destroyed less frequently in relation to the total stock, an indication that cash is circulating more slowly and being held longer outside the banking system.
Data shows that cash in Albania is not disappearing, but is changing its function: from an everyday means of payment, towards an instrument of storage and financial security.
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