Cash Payment Limitations for the entire European Union sends the wrong signal about cash, says the International Currency Association
Press Release, July 20 2021
The International Currency Association (ICA) laments the proposed cash payment limitations included in the anti-money laundering regulation presented today by the European Commission, believing they will do more harm than good and urges European policy makers to continue ensuring that cash can play a key role as a public good, in the European Union and elsewhere.
Underpinning the ICA’s objections are concerns that the proposed restriction to fully prohibit payments above 10 000 EUR will ultimately undermine efforts to protect cash for European citizens who favour it as a means of payment. Whilst there is a diversity of cash-cultures across Europe, cash is a dominant and preferred means of payment for millions across the euro zone, used both as a store of value as well as a means of settling immediate payment. Any measures which weaken citizens’ right to use of cash could sabotage critical progress being made to maintain the role of cash in the European payment landscape, including efforts from the European Commission itself, for example, as part of its Retail Payments Strategy.
The ICA challenge both the necessity and efficacy of the proposed regulation, calling on the European Commission to focus energies on strengthening intergovernmental cooperation and other efforts to enforce existing legislation, in particular, the existing requirements to conduct customer due-diligence for payments over 10 000 EUR which already exist throughout the European Union under the current Anti-Monday Laundering Directive.
Commenting on the proposed regulation, ICA’s Chairman Wolfram Seidemann points out: “Cash is a public good and offers value to all groups of society. The legislator needs to carefully judge the relevance of the risk scenarios to rectify a restriction of this public instrument, since any restriction to the honest use of cash reduces choice, freedom and ultimately punishes weaker groups of society that rely on an efficient cash system.”
Pointing also to the role of the industry to guarantee the integrity of banknotes and coins, ICA’s Director General Jutta Buyse comments: “Placing the focus on cash here is misguided as it associates cash as the means of payment favored for use as part of criminal activities over other forms of digital payments. There is however no evidence to support this assumption. These proposals therefore unfairly penalize the cash industry over other payment sectors. ”
The ICA hopes that the discussion on the proposal in the decision-making process, involving all Member States of the EU through the Council of the European Union and the entire European Parliament, will be able to clarify some of the misconceptions around cash and stands ready to contribute to the discussion.
Proposal for a Regulation on the prevention of the use of the financial system for the purposes of money laundering and terrorist financing – Article 59 proposes “Limits to large cash payments: