Latvia wants to limit cash transactions
Latvia wants to limit cash payments to no more than 3,000 euros. The draft law comes in answer to recommendations from experts at the Council of Europe who had harshly criticised the Latvian authorities' attempts to crack down on money laundering last year as half-hearted. Commentators see the move as tantamount to scrapping cash entirely - and start to panic.
Why in the world do Latvian politicians want to abolish cash payments now, asks Neatkarīgā in dismay:
“Cash is important for shopping and payments. And in Eastern Europe it's an important reserve for a rainy day. Because bank accounts can be blocked and money in an account can be subject to foreclosure. According to the ECB, 32 percent of savings in Latvia are in the form of cash reserves - putting us at the forefront in the Eurozone. Only in Slovakia, Lithuania and Slovenia do people hoard more cash. Even in Estonia, where much is being made of cashless payment, 31 percent of the population still keeps a cash reserve. ... Before the ministers plunge headlong into this adventure they should take a look at all the studies that have been put out on the topic.”
Rejecting cash is welcoming trouble
In Sweden for a few years now people have hardly used cash in stores. But this freedom could have a high price, Dagens Nyheter warns:
“You only need ask how Sweden would hold up if there were a lengthy blackout deliberately triggered with the aim of crippling the payment system. Then at the latest it would be clear that digital payment doesn't always work. ... The payment system is like society's circulatory system, with branches reaching into all areas. ... Without money nothing works. ... You can't simply assume that the average citizen will have a stash of cash under their mattress. ... The Reichsbank wants to launch an e-krona soon as a state alternative to private payment solutions. But if the e-krona becomes reality it won't be able to solve the problem mentioned above.”