Radio chips in euro banknotes

By EDRi · June 4, 2003

Japanese electronics maker Hitachi has told the Japanese press that it has started talks with the European Central Bank (ECB) about the use of RFIDs in euro banknotes.

RFIDs (radio frequency identification) are very small radio chips that transmit a unique serial code when a reader is placed in their proximity. RFID were originally designed for logistic purposes; to track and trace items in transport or stored in warehouses. But the mini-tags are also getting embedded in consumer products, as described in the previous EDRI-gram. This raises great privacy-concerns, since the technology makes it possible to track and trace individual consumption-patterns. The RFIDs have no access control. Anyone with a reader can detect them and read the serial number. The only possibility to protect privacy would be to remove or disable the tag when buying the product in a store.

The RFIDs in euro banknotes could help against counterfeiting and make it possible to detect money hidden in suitcases at airports. But the technology would also enable a mugger to check if a victim has given all of his money. If RFIDs are embedded in banknotes, governments and law enforcement agencies can literally ‘follow the money’ in every transaction.
The anonymity that cash affords in consumer transactions would be eliminated.

Curiously the European Central Bank has stated recently in an biannual report that “the full extent of euro counterfeiting is very small”.

Hitachi mu-chip

Biannual information on the counterfeiting of the euro (23.01.2003)