European Institute

By Ben Antenore, European Affairs Editorial Assistant

Last week, the German Finance Ministry proposed limiting cash payments in Germany to €5,000. The objective is to combat money laundering and better monitor the financing of terrorism. Throughout Europe, particularly in Scandinavia, there has been a move towards the elimination of cash as a method of payment. In Italy, the government of Prime Minister Mario Monti limited cash payments to €1,000 in an effort to stop tax evasion in 2011. Italy loses €100 billion in unpaid taxes every year. Since then, however, Prime Minister Matteo Renzi’s government has raised limits to €2,999.99.

By Ben Antenore, European Affairs Editorial Assistant

Two nations, Norway and Sweden, are making serious moves toward the abolition of paper-based money.

On January 22, Norway’s largest bank DNB called for an end to the usage of cash. In an interview with newspaper Verdens Gang, DNB executive Trond Bentestuen spoke of the dangers and uncontrollable nature of paper currency: “Today, there is approximately 50 billion kroner in circulation and [central bank] Norges Bank can only account for 40 percent of its use. That means that 60 percent of money usage is outside of any control. We believe that is due to under-the-table money and laundering.” For Bentestuen and DNB then, the only solution to fighting money laundering and other illicit practices is a total phasing out of cash. He supported this conclusion with data, citing that only about 6 percent of Norweigans use cash daily and, of that small number, usage is skewed highly toward the elderly.