Organisation of banknote production Prior to the introduction of
euro cash, each central bank was responsible for producing its
own national banknotes. Since 2002, banknote production has been
reorganised in a "pooling scenario". Under this arrangement,
each central bank is responsible for producing a limited number
of denominations. But it does so to meet the need for those
particular denominations throughout the euro area. This division
of labour enables the Eurosystem to benefit from economies of
scale. It also helps in the efficient operation of the Quality
Management System, as there are fewer production sites for each
denomination than there would be without any pooling. Each year
the ECB and the national central banks forecast the likely
overall banknote demand, taking into account the estimated
growth in circulation and the replacement of "unfit" banknotes,
i.e.worn or dirty banknotes which no longer meet the set quality
standards. The banknote production shares are then allocated to
the NCBs accordin