Only Cash is king?

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Finance

Only Cash is king?

For the 500-Euro bill is adopted, the upper limits for cash payments in the conversation, so criminal activities are to be curbed. However, the range of prominent critics is growing.

Ex-judges of the constitutional court Hans-Jürgen papier, has significant legal concerns against the Federal government considered the upper limit for payments with cash. “It’s not insignificant restrictions of several basic rights,” said the former President of the Federal constitutional court in the case of a meeting of the German Bundesbank in Frankfurt on Monday.

The basic law guaranteed the right to property and its free use would be just as cropped as the freedom of contract, because citizens would require payments of a certain amount electronically. Also in relation to European law, he had “significant concerns,” said the paper, because of the cross-border payment transactions would be limited. “In any case, the legislator for his reason must give restrictions on legitimate grounds in the public interest”, stressed the paper.

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Notes on risks

Proponents promise from the upper limits of a containment of criminal activities. There is a Laundry of the police authorities and customs “is very clear warnings on the risks” of cash as the funding of terrorism and money-said the head of the financial market Department in the Federal Ministry of Finance, Levin Holle. The policy must balance between individual liberty and the General protection of the safety of the citizens. Holle insured: “It is not in any way to the abolition of cash.”

In twelve of the 28 EU member States, there are already restrictions on payments by note and coin. Germany is aiming to a common solution and has brought a 5,000-Euro limit into the game. Bundesbank President Jens Weidmann reiterated his doubts as to the effectiveness of such a measure. No studies were “known, clearly demonstrate that, with cash restrictions, the organised crime, tax evasion and international terrorism in fact, be fought effectively”.

The upper limits of “not totally disabled”

Paper, upper limits for very high cash payments rails “to be totally unfit to this crime”. However, this evaluation was “very superficially”. The lawyer warned: “The legislature should be guided by the hasty and vague assumptions.” It was “not apparent how the state of compliance with such upper control limits to be effective, and might prevail”.

Meanwhile, the 500-Euro note since the beginning of may is decided. Expected at the earliest by the end of 2018 no 500 more will be put in circulation. Desires to a complete abolition of cash rejected Weidmann. He considered that “the abolition of cash for not a useful Instrument to stimulate the monetary policy”. Instead, the aim is to strengthen growth in the Euro area. The ultra-loose monetary policy of the European Central Bank (ECB) is currently appropriate, said Weidmann, but stressed at the same time: “The current monetary policy environment requires no further loosening.”

Consumers want to continue to pay cash

The Bundesbank is doing for cash as a payment medium strong, assured, Bundesbank Executive Board member Carl-Ludwig Thiele. A few weeks ago, Thiele had reported: “To it to the extent that consumers use more the Smartphone than the Banknote and the coin to Pay at the checkout, it will still take some time.”

While many Swedes and Danes pay for long with card or via mobile App with your phone – no matter whether at the flea market, in the Taxi or in the pub – trust the people in Germany are calculated will continue to be paid especially on note and coin: the case For 79 percent of the transactions in this country bar, like the Bundesbank, based on data of 2014. A good half (53 per cent) of the retail sales in Germany are handled with cash.

In a GfK survey conducted on behalf of the banking Association BdB, 91 per cent of the 1001 representatively surveyed adults in Germany declined in February, a complete abolition of cash. The consumers in this country, “miles far from want to cash in your daily life”, says Germany’s top consumer advocates, Klaus Müller, on Monday. And that is a good thing: “cash Only allows the Numbers without the data traces. What books and magazines I buy, how often I go to the pharmacy – all of which must remain anonymous.”