With multiple countries around the world looking to become cashless, things are starting to change slowly but surely. In Germany, the Social Democrats want to impose a limit on cash transactions, as well as get rid of the 500 EUR note completely. However, Germany may prove to be quite a different country when it comes to abolishing cash, as non-cash payment methods are not gaining the upper hand just yet.
When it comes to paying in cash, the process feels a bit clumsy most of the time. Not only is there a variety of bills to take into account, but there are tons of different coins that represent a specific value. Dealing with change is another issue, as calculations have to be made and the right amount of bills and coins have to be sorted by the cashier.
None of these factors are keeping German citizens from paying with cash though, as it remains the preferred method of payment throughout the country. However, that isn’t keeping the Social Democrats party from proposing a change in the way people deal with cash. Their new proposal would lead to a limit of cash transaction amounts, as well as completely remove the 500 EUR note from circulation.
It has to be said that the 500 EUR note has become rather useless to most consumers and businesses these days. There is hardly any retailer accepting Euro bills valued at more than 100 EUR these days. Getting rid of the 500 EUR bill is a good idea as there is hardly anyone using it in the first place, so it won’t be missed as much.
Statistics indicate how less than 20% of payments made in Germany throughout 2014 were done through plastic cards. Compared to the rest of the European Union, this number is incredibly low. This just goes to show that not every country will be going cashless anytime soon, which can be both a blessing and a curse in the long run.
Imposing a maximum transaction limit of 5,000 EUR will not do much to limit the amount of cash payments being made throughout Germany though. Very few goods or services cost in excess of 5,000 EUR these days, and it is hard to imagine people would actually use cash to pay such large amounts. Walking around with a lot of cash in one’s pocket is not the safest thing to do these days, and plastic cards provide a valuable alternative.
Unlike what most people might think, this proposal will have little to no effect on Bitcoin adoption in Germany. Even though consumers are not too keen on paying with plastic cards, cash remains king in the country, and Bitcoin will provide a viable alternative to both payment options in due time.
Imposing a maximum cash transaction limit of 5,000 EUR will not keep people from buying Bitcoin either. After all, given the current Bitcoin price, 5,000 EUR will still get one roughly 14.5 bitcoins, which is more than sufficient for an investment. In the end, there will be no direct on Bitcoin adoption in Germany, as these changes will neither benefit nor damage the potential of digital currency.
What are your thoughts on removing the 500 EUR note from circulation? Do cash transaction limits of such magnitude even matter? Let us know in the comments below!
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