As of: January 30, 2024, 11:04 a.m
By: Karolin Schaefer, Kilian Bäuml
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The EU is introducing a cap on cash payments.
This measure could have an impact, especially for larger purchases.
Frankfurt – Nowadays, many people prefer to pay with debit or credit cards, while the popularity of cash is steadily decreasing in Germany.
And yet many people still kept their savings at home.
Often out of skepticism towards banks.
The European Union (EU) will now introduce stricter cash regulations, which could have an impact, especially for larger purchases.
The EU is planning to combat money laundering with a cash cap.
(Symbolic image) © Stefan Puchner/dpa
The EU intends to use this new regulation to advance the fight against money laundering and terrorist financing.
A so-called cash limit will be introduced, which will apply across the EU.
This upper limit is set at 10,000 euros, as the EU Commission announced in a statement on Thursday (January 18).
In addition, member countries have the option to set a lower limit or maintain existing limits.
New EU regulation: Cash payments only up to 10,000 euros
According to the new regulation, proof of identity and proof of the origin of the money are required for cash transactions between 3,000 and 10,000 euros.
This data must be collected and stored by retailers and institutes.
In Germany, this rule previously only applied from 10,000 euros.
“The preliminary agreement on an anti-money laundering regulation will for the first time fully harmonize the relevant rules across the EU and close potential loopholes used by criminals to launder illegally acquired funds through the financial system or to finance terrorist activities,” said the commission.
New EU cash border – although Germany is critical
Until the new regulation takes effect, there is no limit on cash payments.
Before the agreement, Germany had expressed criticism of an upper limit.
However, other countries already have upper limits for cash payments.
For example, in Belgium the upper limit is 3,000 euros, in Italy it is 5,000 euros.
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Furthermore, luxury goods retailers, providers of crypto assets and professional football clubs will be required to check their customers and report suspicious activity above certain amounts.
However, the new EU regulation is not limited to consumer purchases, but also applies to payments between two companies and between companies and consumers.
Consumers will continue to have unlimited access to cash.
It is even recommended to have some cash at home, especially in case of emergencies.
Cash cap should be “an end to Germany’s money laundering paradise”.
After the verdict in the Cum-Ex tax scandal in spring 2023, the Greens called for stricter rules for cash payments.
“The only way to end Germany’s money laundering paradise is with a cash limit,” said Bundestag member Bruno Hönel at the time.
The Federal Ministry of Finance, headed by Christian Lindner (FDP), had until recently expressed concerns.
“Cash must remain as an alternative to digital payment transactions,” the Handelsblatt reported from the ministry.
The EU Commission's legislation only needs to be formally adopted.
However, it could still be a while before the cap actually comes into effect.
According to Parliament, the new rules should generally apply three years after they come into force.
After a series of ATM explosions, a bank has opted for cash pavilions, while a savings bank no longer wants to accept cash.
The editor wrote this article and then used an AI language model for optimization at his own discretion. All information has been carefully checked.
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