European Central Bank issues warning on Spain’s cash limit

European Central Bank issues warning on Spain's cash limit

The European Central Bank has issued a warning on Spain’s current cash limit.

Spain has a set limit on the amount of cash that can be used to carry out payments, a restriction which aims to stop tax fraud. The limit was previously 2,500 euros, but as of last year the limit was lowered to 1,000 euros which is why consumers who wish to pay for a purchase that exceeds 1,000 euros, in any establishment, must pay by card or by transfer.

However, as stated by the Organisation of Consumers and Users (OCU), the European Central Bank does not agree with this limit, and has therefore drawn up a report in which states: 

  • The limit of 1,000 euros is disproportionate.
  • This limitation will have adverse effects on the legal tender status of euro banknotes.
  • By significantly reducing the ability of payers to use euros, the freedom of citizens to choose the means of payment is also reduced.
  • The penalty regime laid down in the law is excessive: the fine of 25% of the amount paid is, in the view of the European Central Bank, too high. 

In addition to this, cash payment is of great importance, especially for certain social groups, which is why the European Central Bank also makes several points in this respect, as stated by the OCU: 

  • Cash is widely accepted.
  • It is fast, and allows transactions to be settled instantly.
  • It is an always-available option, as it does not require an operational technical infrastructure and related investments, issues that need to be taken into account in situations such as power outages or failures of electronic payment systems.
  • It makes it easier for payers to control their own spending.
  • It is the only means of payment that does not entail the legal possibility of charging a fee for its use.
  • Cash payment is not subject to daily or weekly payment limits set by banks.

There are several factors that explain why this limit on cash payments encourages financial exclusion: “Cash is essential for elderly users, migrants, the disabled, socially vulnerable citizens and anyone with limited access to digital services”, they argue.

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Written by

Joshua Manning

Originally from the UK, Joshua is based on the Costa Blanca and is a web reporter for the Euro Weekly News covering international and Spanish national news. Got a news story you want to share? Then get in touch at


    • John Lewington

      29 April 2022 • 09:38

      Spanish banks are obviously aware of all the reasons outlined why the limit should not be so low so what will the central banks statement do to help those penalised action is required

    • John Lewington

      29 April 2022 • 09:39

      How will this help in persuading banks to increase limits

    Comments are closed.