Stay tuned with CashEssentials news ! - beyond payments
By subscribing, you accept our Privacy Policy.

Luxury industry affected by cash restrictions

Categories : Cash is efficient, Cash is the most widely used payment instrument
May 1, 2017
Tags : Cash, Cash restrictions, Europe, Regulation, Retailers, Usage
France's restrictions on cash payments are feared to cause unfair competition for French luxury goods stores - especially the jewelry and watchmaking sectors.
Communication Team / Equipo de Comunicación

Over the past few years, the European Parliament has adopted several directives to fight against money-laundering and terrorist financing. As part of these measures, European authorities decided to monitor high-value cash transactions and recently lowered the critical value to €10,000.

In this context, the Finance Ministry of France imposed a new ban on cash payments and lowered the previous €3,000 limit to €1,000 in September 2015. Furthermore, the Ministry plans to restrict cash transactions made by foreigners and to lower the current €15,000 threshold to €10,000 in 2017. The luxury industry – especially the jewellery and watchmaking sectors – would be severely affected by this measure as numerous tourists rely only on paper money to purchase luxury goods. According to a survey conducted by Xerfi, 75% of tourists traveling to France do not know about the existing limit on cash payments.

Various professional organisations and associations worry that these restrictions might lead to unfair competition between France and its neighbours. Indeed, the majority of European countries do not prohibit cash purchases exceeding €10,000. French businesses already registered a drop in sales as many customers were forced to abandon their purchases at the checkout line because they carried only cash.

To read the original article [in French], please click here.