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Germany mulls putting the lid on cash usage over 5,000 euros

The German government is pondering setting up an upper limit for cash payments as part of its efforts to fight global terrorism and money laundering. Berlin intends to push for such a limit at EU level.

Germany's government is considering introducing a limit of 5,000 euros ($5,450) on cash transactions, Deputy Finance Minister Michael Meister said Wednesday in Berlin.

He added that while Germany would work to reach an EU-wide arrangement on this issue, it could introduce a national limit if the efforts failed to deliver an agreement.

The proposed upper limit, said Meister, was aimed at combating illegal money transactions, particularly

terror financing and offenses related to money laundering.
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Cash-free payment is the future

A recent study commissioned by the German government concluded that money laundering - a process of turning the proceeds of illegal activities such as blackmailing, drug or arms trading into legal money or assets - amounts to over 100 billion euros annually in Germany.

Attack on privacy?

The government believes imposing an upper limit of 5,000 euros on cash payments would stem the flow of illegal money into the country. It made it abundantly clear that such a measure would by no means aim to pave the ground for doing away with cash payments altogether.

While a few European countries such as Bulgaria and Italy have already put in place such measures, others like Portugal are considering introducing similar restrictions.

However, the idea of placing an upper limit on the usage of cash has also sparked criticism in Germany, where people tend to use cash more than in many other EU nations.

Opposition Green Party lawmaker Konstantin von Notz tweeted that trying to limit cash payments "is a new fundamental attack on data protection and privacy."

sri/hg (dpa, Reuters, AP)

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