Cav's Place

Three months ago, I was somewhat relieved when the European Central Bank submitted an opinion in which it stressed the importance of the continued availability of cash payments and actually requested a ban on “no cash” policies, and of course also by the ECB’s page about the role of cash, which does a really good job of briefly and accurately explaining the benefits of sticking to cash. And, just earlier this week, the Bundesbank presented the results of a study about the future of cash use, which expresses alarm at the possibility that access to and acceptance of cash may not be fully guaranteed and stresses that measures need to be taken to ensure the preservation and widespread use of cash, allowing people to decide for themselves whether to pay in cash or not.
However, instead of indicating the direction that is to be taken, the Bundesbank’s release was actually meant to raise the alarm about the fact that things are moving in the opposite one, seeing as it came a day before the announcement that the European Union reached a provisional agreement on various measures that, under the guise of fighting against money laundering, include limiting cash payments to €10000 and more surveillance of transactions, including verifying those who just happen to occasionally pay at least €3000 in cash. The package still needs to be formally adopted and it includes other measures that seem reasonable, and plenty of member states already have limits on cash payments that are even lower than €10000, which will still be allowed under the new regulations, plus that €10000 is a high enough limit that it shouldn’t really affect regular people in their everyday lives, but setting such a limit at the level of the European Union sets a precedent and sends a dangerous message.
Even with this limit, anyone may at some point buy or sell real estate or motorized vehicles, for example, in which case they may well be forbidden from using or accepting cash, and that lower threshold of €3000 that may put people under scrutiny may be reached in far more scenarios and by far more individuals. But, again, the harder part is setting the first limit, as once that happens it’s likely to be far easier to change it, most likely in order to make it ever more restrictive in the future. And the very concept of including a limit above which cash payments are forbidden and one above which those who make cash transactions are to be verified as part of a package against money laundering that is to be implemented in the entire European Union sends the dangerous message that, despite all of the real benefits of sticking to, or at least preferring, cash, those who do so are to be seen as potential criminals, that using cash is somehow suspicious by default.