In 2016, the Modi government removed the legal tenderMoney that is legally valid for the payment of debts and must be accepted for that purpose when offered. Each jurisdiction determines what is legal tender, but essentially it is anything which when offered (“tendered”) in payment of a debt extinguishes the debt. There is no obligation on the creditor to accept the tendered payment, but the act of tendering the payment in legal tender discharges the debt. More status of the INR500 and INR1,000 banknotes to curtail terrorism financing and reduce the size of the underground economy. The measure caused hardship for informal workers and unbanked women, with long bank queues and riots.
Shortly after, several groups filed public interest petitions to the Indian Supreme Court, questioning the measure’s validity. According to Namita Wahi, a fellow at the Centre for Policy Research in Delhi, the demonetization acted against the “fundamental rights to movement, Article 19(1)(d); trade or business, Article 19(1)(g); livelihood, and in the case of those dead, life (Article 21); equality (Article 14); and the constitutional right to property (Article 300A).”
Per the RBI Act Section 26(d), while the government has the power to cancel the legal tender of any note series, the 2016 demonetization would have required the passing of an ordinance in Parliament, such as in 1946 and 1978, and not an executive action to extinguish the value of the banknotes, technically debt issued by the Reserve BankSee Central bank. More of India (RBI). As Wahi said,
We live in a country governed by the rule of law, and not by the rule of men. The objectives of the demonetisationSee Demonetised banknote. More notification may be laudable, whether the notification will achieve those objectives is debatable. But, as it exists, the demonetisation notification is illegal and violates the Constitution.
In 2016, the European Central Bank stopped issuing the €500 denominationEach individual value in a series of banknotes or coins. More. Harald Mahrer, then deputy economy minister of Austria and current president of the Austrian Economic Chamber, voiced his opposition to the proposal and stated his support to enshrine the right for citizens to use cash to protect their privacy in the Constitution, during an interview with public radio station Oe1:
We don’t want someone to be able to track digitally what we buy, eat and drink, what books we read and what movies we watch. We will fight everywhere against [anti-cash] rules.
In May 2021, the European Commission proposed introducing a €10,000 limit on cash payments as part of a legislative package against money laundering. Gernot Blümel, the Austrian finance minister, opposed the measure, citing citizens’ freedoms and the resilient habits to pay in cash despite the Covid-19 pandemic:
Austria is committed to measures against money launderingThe operation of attempting to disguise a set of fraudulently or criminally obtained funds as legal, in operations undeclared to tax authorities, and therefore not subjected to taxation. Money laundering activities are strongly pursued by authorities and in most countries, there are strict rules for credit institutions to cooperate in the fight against money laundering operations, to declare and report any transactions that could be considered suspicious. More and the fight against terrorist financing. However, I doubt whether a general cash ceiling is effective in this regard. It is an illusion to believe that restricting cash will lead to less criminal activity. […] From Austria, there is a clear yes to the fight against moneyFrom the Latin word moneta, nickname that was given by Romans to the goddess Juno because there was a minting workshop next to her temple. Money is any item that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular region, country or socio-economic context. Its onset dates back to the origins of humanity and its physical representation has taken on very varied forms until the appearance of metal coins. The banknote, a typical representati... More laundering and terrorist financing and an equally clear no to attacks on cash. Cash gives people a feeling of security, independence, and freedom. We want to preserve this freedom for people.
In October, the Central Bank launched the Euro Cash 360° Platform, along with the Austrian MintAn industrial facility manufacturing coins. More, social partners, and other interest groups, to strengthen and safeguard the role of cash by facilitating open dialogue. The platform openly promotes cash in stark contrast to the traditional neutrality of most central banks.
In parallel, more than half a million Austrians have signed a petition calling for a referendum on the constitutional enshrining of the right to unlimited cash payments. Petitions which receive over 100,000 signatures require a debate in Parliament.
Since the 2013 arrival of Uber in Mexico, several state governments (including Mexico City and Puebla) have prohibited cash fares on mobility platforms. In 2017, several Colima lawmakers brought a case to the country’s Supreme Court against the state’s 2015 mobility law that banned cash fares in ride-hailing apps.
In November 2018, the Supreme Court ruled that the ban was unconstitutional. The 8-3 ruling met the majority needed to set a binding precedent.
Article 172 of [Colima’s] Sustainable Mobility Law […] violates Article 28 of the Mexican Constitution since it prohibits [citizens to use] cash to pay for private transportation for rent services obtained through technological applications. As the Constitution established the existence of the Bank of Mexico and granted the monopoly of coining money and issuing banknotes amid its powers, and [the Bank’s] coins and notes are current money in national territory, any law banning the use of cash to settle the paymentA transfer of funds which discharges an obligation on the part of a payer vis-à-vis a payee. More of an obligation, regardless of its cause, becomes unconstitutional […]. Alternative means of payment, such as credit or debit cards, do not supplant cash. This prohibition generates an unjustified prejudice and discriminatory treatment, as it automatically excludes those who lack a payment-guarantee instrument such as a credit card. It also has a [negative] impact on the owners and drivers of vehicles used for private transportation services, who would lose a large number of people who are the natural counterparts for the development and completion of a lawful and sustainable activity (SCJN AI 13/2017: 6-7, DOF 2018).
“We are celebrating this resolution. Our operation, and all the people that are now deciding to pay for their trips in cash, are now protected by the Supreme Court,” said Sergio Romero, Uber’s legal director in Mexico.
While the Mobility Secretariat (Semovi) of Mexico City has continued to ban cash payments in ride-hailing apps, Uber has continued accepting cash fares. “We believe this is a constitutional right for our riders and drivers,” said Federico Ranero, Uber’s general manager in Mexico.
In the document “The Role and Future of Cash,” (DNB 2020: 42-43), Jurgen Spaanderman, senior policy advisor at the Cash Policy Department of De Nederlandsche Bank, states:
Privacy is a constitutional right (Article 10 of the Dutch Constitution). People may prefer anonymity in the case of specific purchases, for example at the pharmacy of when buying a gift. Cash is untraceable thanks to its physical form, allowing the buyer to remain anonymous and preventing the recipient to use the payment data for commercial purposes. Banks cannot use this payment data commercially either, since they are not involved in cash payments. Last but not least, cash payments are out of sight of the authorities. The government is increasingly imposing restrictions on anonymous use of cash in order to prevent money laundering and crime through cash payments. DNB welcomes additional anti-money laundering measures as long as they do not hamper the smooth functioning of cash payments in legitimate transactions.
In April 2022, the major Dutch banks, the Dutch Payments Association, representatives of consumers, retailers, the hospitality industry, petrol stations, cash services providers, and the DNB signed a Cash Covenant to ensure that cash continues to function correctly. The agreements will, in principle, be in place for five years.