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New EU Limits on Cash Payments: What You Need to Know
What’s Changing
• From 10 July 2027, the European Union will enforce a maximum cash payment limit of €10,000 for certain transactions.
• For cash payments between €3,000 and €10,000, the person making the payment must be identified (ID verification).
• These rules come under the EU’s strengthened anti-money-laundering (AML) regulation.
Why the EU Is Doing This
1. Fighting Money Laundering and Terrorism Financing
• Large cash transactions are historically one of the easiest ways to launder money. Limiting them and requiring ID makes illicit flows harder to hide.
• The EU wants a more harmonised rule across member states — currently, cash limits differ significantly between countries.
2. Increasing Transparency and Oversight
• With identification required for “occasional transactions” (i.e., not habitual business payments) in the €3,000–€10,000 range, traceability rises.
• The regulation also strengthens due diligence for “obliged entities” (e.g., banks, real estate agents, luxury goods dealers) to verify identities.
• Financial Intelligence Units (FIUs) will have more power to analyse reports and even suspend suspicious transactions.
Some Key Clarifications & Exceptions
• Business vs. Private Transactions
• The €10,000 cap applies to cash payments to businesses (“obliged entities”), not all private-to-private transactions.
• For example, two private individuals (say, selling a used car privately) can still pay more than €10,000 in cash, unless their country sets a lower national limit.
• Bank Deposits Are Exempt
• Deposits made at credit institutions, payment institutions, or e-money institutions are not covered by the €10,000 cash limit.
• So, paying in over the limit into a bank is allowed; the restriction is on business payments in cash.
• National Flexibility
• EU member states are allowed to impose lower cash limits if they wish.
• This means that, depending on your country, the practical cap could be stricter than €10,000.
The Implications
Pros
• Tighter Anti-Crime Measures: The regulation could significantly reduce money laundering and illicit cash flows.
• Harmonisation: A unified approach across the EU reduces loopholes between countries.
• Better Monitoring: Businesses will have to collect more customer data for larger cash payments, feeding into better AML oversight.
Concerns & Risks
• Privacy and Financial Freedom: Some people argue that requiring ID for relatively modest cash payments infringes on financial privacy.
• Digital Exclusion: Not everyone has easy access to non-cash payment methods (e.g., digital banking), so limiting cash could disadvantage some groups.
• Operational Burden: Businesses (especially small ones) may struggle to handle the paperwork and verification for cash transactions between €3,000–€10,000.
Where We Are Now & What’s Next
• The regulation (EU) 2024/1624 was agreed by the European Parliament and Council and adopted.
• The rules will take full effect in July 2027, giving member states and businesses time to prepare.
• There is also a broader AML package, including increased powers for FIUs and more transparency around “beneficial ownership” of companies.
What This Means for Individuals
• If you’re planning to make a large cash payment to a business, think ahead:
• If it’s over €10,000, you won’t be able to do it in cash.
• If it’s between €3,000 and €10,000, be ready to show ID.
• If you’re saving or holding cash, nothing changes: there’s no general ban on owning or withdrawing cash just because of this rule.
• For business owners, especially in high-risk sectors (luxury goods, real estate, asset management), compliance processes will need updating — ID checks, record-keeping, etc.
Bottom Line
These changes mark a significant step by the EU to crack down on money laundering and make financial flows more transparent. While it’s not a cash ban per se, it does restrict how cash can be used in business transactions and brings more scrutiny to larger payments. The trade-off: more financial oversight — but potentially less privacy and a greater burden on both customers and businesses.
Attached is a news article regarding the EU banning cash payments over €10k and require ID for cash payments over €3K
https://www.bitget.com/amp/news/detail/12560605057253
Article written and configured by Christopher Stanley
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