MEP Wants To Strengthen EU's Access To Cash Law

January 16, 2024
The European Parliament’s rapporteur for the Single Currency Package has released suggested amendments to the euro banknotes proposal, including increased reporting requirements for payment service providers.

The European Parliament’s rapporteur for the Single Currency Package has released suggested amendments to the euro banknotes proposal, including increased reporting requirements for payment service providers (PSPs). 

Stefan Berger, a member of the European Parliament (MEP), has published his draft report on the proposal for a regulation on the legal tender of euro banknotes and coins.

Berger is the MEP responsible for the European Parliament’s management of the EU’s access to cash legislation and the framework for a digital euro, which were proposed together as the Single Currency Package in June last year. 

The legislative proposal on the legal tender of euro cash is intended by the European Commission to safeguard the role of cash, ensure it is widely accepted as a means of payment and remains easily accessible for people and businesses across the euro area.

Berger has gone further than the European Commission in some aspects of the draft report. 

For example, one amendment says that “to facilitate monitoring by Member States, payment services providers and ATM providers should notify their national competent authority in writing of the closure of each ATM or bank branch and share an assessment of whether the sufficient and efficient access to cash remains guaranteed as defined by the common indicators”.

“Where the level of access to cash is not sufficient and effective, the provider responsible for the closure should take measures to remedy that situation,” the amendment says. 

Proposals aimed at merchants

Merchants would also be subjected to stricter rules via Berger’s proposal. 

For example, one amendment added says that “payees subject to the obligation to accept euro banknotes and coins shall not use contractual terms that have not been individually negotiated or commercial practices”. 

This will include “no cash” signs, which Berger’s amendment says “have the object or the effect of excluding the use of euro banknotes and coins by payers of monetary debts denominated in euro”. 

“Such contractual terms or commercial practices shall not be binding on the payer,” the amendment says. “A contractual term shall be regarded as not having been individually negotiated where it has been drafted in advance and where the payer has therefore not been able to influence the substance of the term, particularly in the context of a pre-formulated standard form contract.”

Digital payments exempt from cash obligation

Berger has also laid down an amendment that says that "the regulation should apply to payment obligations that give rise to pecuniary debts to be settled in cash".

This amendment exempts digital payments, saying that the law "should not apply to payments for goods or services purchased at a distance, whether online or through any means of distance communication".

Digital euro versus cash

The digital euro has also been touched upon by the draft report. 

For example, one amendment laid down by the German MEP says that to ensure that people and businesses benefit from a wide acceptance network and can use the digital euro effectively in their day-to-day payments, payees subject to the mandatory acceptance of payments in digital euro “should not unilaterally exclude payments in cash through contractual terms that have not been individually negotiated or through commercial practices”. 

However, otherwise, the framework for the digital euro has not received as much attention from MEPs, including Berger. 

Sources in Brussels have alleged that MEPs are hesitant to approach the subject before the European elections taking place between June 6 and 9 this year. This is because they feel that it is a lose-lose situation. 

For example, sceptics may feel compelled to vote a different way if they think that a candidate is in favour of a digital euro being issued. 

For now, it is unlikely that much work will be carried out on the venture in the European Parliament, with the focus very much on other legislative files. 

Meanwhile, MEPs may be keen to appear in favour of cash-friendly legislation. For example, plenty of member states are in the process of passing access to cash-related legislation, while national competent authorities are also looking into the issue. 

For example, the Spanish Council of Ministers issued Royal Decree-Law 8/2023 on December 27 last year. 

This contained measures to promote financial inclusion within vulnerable groups, including that PSPs can no longer charge commissions concerning over-the-counter cash withdrawal services to individuals over the age of 65 or with a recognised disability equal to or greater than 33 percent.

Meanwhile, the Irish government is also consulting on access to and the acceptance of cash as part of its public consultation on a National Payment Strategy.

And, in December 2022, Italy’s government introduced legislation that raised the limits on cash payments, while supporting merchants to refuse cards for purchases below €60.

Going forward, MEPs on the Economic and Monetary Affairs Committee (ECON) have until January 23 to respond to the draft report with their own amendments. 

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