EU revises money laundering regulations: retailers warn of the end of popular prepaid cards

Created: 06/14/2022, 10:18 am

By: Markus Hofstetter

So far, you don't have to present proof of identity when buying prepaid cards up to 150 euros.

© blickwinkel/imago

The EU wants to take stricter action against money laundering and terrorist financing.

However, the rules discussed could complicate the previously uncomplicated handling of prepaid cards.

Berlin - If you are looking for a gift at the last moment, you can also find it at the supermarket checkout.

Without a long search, be it on the Internet or in stores, you can often find a large selection of vouchers and prepaid cards from a wide variety of providers.

You can buy the small plastic cards from Amazon, Netflix or Google in a wide variety of denominations quickly and easily.

“Vouchers have been the most popular Christmas present in Germany for many years.

Vouchers worth around three billion euros end up under the Christmas tree every year.

This also includes vouchers based on e-money,” says Stefan Genth, General Manager of the German Retail Association (HDE).

However, the HDE warns that these cards could soon be out of business.

Vouchers and prepaid cards are on the brink: will you have to show your ID for every purchase in the future?

The reason is that the EU is revising its regulations to make money laundering and terrorist financing more difficult.

New requirements are also being discussed which, according to the HDE, would in practice mean that the identity of the customer would have to be recorded every time an e-money product was purchased.

That would mean that the buyer would have to identify himself at the checkout, for example with an ID card.

So far, no proof of identity is required up to a threshold of 150 euros.

The previous threshold of 150 euros has proven its worth, according to the HDE.

On the Internet, the maximum limit for a transaction is only 50 euros.

With these small sums in connection with the risk-reducing measures taken by the publishers, there is no seriously justifiable risk of money laundering, the HDE continues.

The Prepaid Verband Deutschland e.

V. (PVD) warns of an end to prepaid cards.

The association fears that many customers will no longer have access because of the cumbersome procedures.

"In times of growing sensitivity to personal rights and data protection, waiving this exception would be completely contrary to the individual right to anonymity," says Jonny Natelberg from the PVD.

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Vouchers and prepaid cards are threatened: small anonymous transactions should be retained

If the previous exemption for low-risk e-money products is abolished, HDE and PVD see the danger that such products could largely disappear from the market.

Especially with corresponding e-money gift or voucher cards, customer identification would be difficult to communicate to consumers and would not be proportionate, especially with regard to data economy and data protection.

That is why the two associations are calling for the exception option to be retained.

Because consumers should also be able to make anonymous e-money payments of up to 150 euros in the future.

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