Last Wednesday, the Swiss National Bank (SNB) announced that old Swiss banknotes would no longer be legal tender from Friday, 30 April 2021. The short notice period has generated complaints and confusion.
The eighth series of Swiss banknotes did not lose their value, however, they are no longer an accepted means of exchange. The only places they can still be used are at Swiss Rail and Swiss Post until the end of October 2021. They can however be exchanged at SNB cash desks and select branches of some cantonal banks for their full value. There is no time limit on doing this.
Despite there being no time limit, some rushed to SNB cash desks and banks to change notes before the 30 April deadline, and long queues formed outside some bank branches, according to SRF.
According to the SNB, 149 million old notes valued at CHF 34 billion remain in circulation. This represents around 40% of all the Swiss banknotes circulating.
People have started to hoard more cash, partly for psychological reasons associated with crises, but also in some cases to avoid Switzerland’s negative interest rates.
Black undeclared money associated with crime also makes up some portion of this hoarded cash. Due diligence and money laundering rules require banks to request proof of origin when exchanging notes. Providing proof of origin is likely to prove problematic if the cash is associated with criminal activity.
In response to criticism that the SNB had given too little notice, an SNB spokeswoman said that there was no legally specified notice period and that similarly short notice period was used in 2000 when the sixth series of Swiss banknotes was withdrawn.
SRF article (in German)