New laws on cash payments in Europe
On April 24, 2024, the European Parliament approved a new law imposing a maximum limit on cash payments within the European Union, as part of a move to combat money laundering and the financing of terrorism. From now on, cash will be prohibited for any purchase exceeding 10,000 euros, and such transactions must be completed electronically.
The new law does not stop there; it requires merchants to collect customers' personal data for any cash payment of 3,000 euros or more, in order to facilitate tracking transactions later if necessary.
While some member states may impose cash limits lower than this threshold, the €10,000 remains the unified ceiling adopted throughout the European Union.
In Germany, there were previously no official limits on cash payments. However, the identity of the payer and the source of funds had to be verified if the amount exceeded 10,000 euros. With the new European rules, merchants are now required to regularly record and retain this information.
The aim of this decision is to unify financial laws in the European Union member states and to prevent criminals from exploiting legal loopholes. Competent authorities, such as German customs, will also receive expanded powers to allow them to examine suspicious transactions more thoroughly and temporarily suspend them when necessary.
The new regulations are not limited to public financial transactions only, but also cover other sectors such as banks, casinos, luxury goods and precious metals traders, and cryptocurrency service providers. They may also extend to professional football clubs and player agents, who will be required to monitor certain financial transactions and report suspicious activities.
These regulations are expected to come into effect three years after their official approval by the Parliament and the European Council.