Slovakia Adopts a Constitutional Right to Cash

Cash in Slovakia: A SPACE Approach

Per the European Central Bank’s (ECB) latest Study on the Payment Attitudes of Consumers in the Euro Area (SPACE), published in December 2022.

• Slovakia registered one of the largest declines in cash use by value (-12%) between 2019 and 2022.
• Slovakia (58%) had the highest share of people keeping extra cash reserves.
• 6% of Slovakians reported receiving up to a quarter of their income in cash.
• A significant share of respondents in Slovakia (10%) reported they always paid a fee when withdrawing cash, pointing to problems in cash access.
• Having a cash option is crucial for a plurality (46%).

The Right to Pay in Cash

Everyone has the right to pay for the purchase of goods and services in cash, says a new amendment to the Slovak constitution passed on June 15 with the support of 111 members of Parliament and is meant to protect cash payments from a future in which digital payments become mandatory.

According to the law’s authors, citizens have the right to decide whether they want to pay in cash. They declared that recently they had witnessed various initiatives leading to this right’s gradual restriction.

According to the deputies, the complete abolition of cash in the future would significantly endanger low-income groups of the population, but also, for example, civil associations that finance their charitable activities from fundraising. According to them, preserving the right to cash is also an essential step in building the financial literacy of the younger generation.

At the same time, they stated that the introduction of mandatory cashless transactions above a specific limit in the legal system of Slovakia could be seen as a measure to limit fraudulent procedures in the tax area, to fight against money laundering, corruption, criminal activity or to protect against the financing of terrorism. Therefore, the Constitution should also envisage the legal regulation of conditions and restrictions on using cash.

An amendment provides that it will be possible to refuse cash only for “appropriate or generally applicable reasons”, including security and technical reasons, e.g. a vending machine that does not accept cash.

The constitutional law will be effective from July 1 of this year.

Other Countries May Soon Vote on the Issue

In Switzerland, a popular initiative – a form of direct democracy – was submitted in February 2023, calling for access to banknotes and coins to be enshrined in the Constitution. In May 2023, the Federal Council submitted a direct counter-proposal to incorporate additional legal wording into the Constitution.

In Austria, more than half a million people signed a petition in 2022, calling for a referendum for the constitutional enshrining of the right to unlimited cash payments. Petitions which receive over 100,000 signatures require a debate in Parliament.

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