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Cash is King is a well-known business mantra. But it also appears to be Italian, and is rather archaic given the advances in digital payments that don’t always equate to punitive fees.
Matthew Parsons
The pandemic has accelerated the global shift to digital payments, but there are signs of a slowdown in Italy.
Italy’s new prime minister, Giorgia Meloni, reportedly earlier this month told Italian merchants to allow digital payments for transactions under €60 ($64), arguing that the fees paid to banks and digital payment providers were too high. wanted to give the right to refuse .
The country’s previous government imposed fines on shops that refused card payments. She also plans to raise the limit of legal cash transactions from her $1,060 to her $5,300, according to a Financial Times report, saying that digital payments will “spy on a citizen’s every habit and It suggests that it will lead to “profiling”.
The problem is that the European Commission wants more digital payments, not less. This makes tax evasion less likely and the modernization of payments is also relevant to the conditions of post-corona national recovery and recovery plans, they argue.
On Dec. 21, the Italian parliament instead approved measures that could tax payment companies and banks if they fail to reduce fees for electronic transactions, but the focus on cash may continue. seems to be high.
Against the Grain
As companies increasingly adopt digital payments for their employees, card rejection becomes a problem for most business travelers. It’s designed to help business travelers spend less time filling out expense forms and worrying about carrying cash, while helping businesses better handle their spending.
It also has a safety benefit, as travelers can track where they made their purchases in case of an emergency.
Tim Russo, Senior Director of Fintech Partnerships and Business Development at TripActions, said: liquid.
“Rather than implement a cash-first policy, the Italian government will partner with SMEs and consumers to avoid increased security risks for store employees and operational overheads for SMEs, such as transferring cash to stores. We need to find innovative solutions that help eliminate the banking, or tax evasion concerns.”
Now, rather than trying to get rid of fines for hotels and shops refusing to accept card payments, the Italian government is instead trying to broker transactions between banks, payment companies and retailers so that companies with annual revenues can earn more. aims to reduce electronic transaction fees by up to $32. Up to $424,200, according to Reuters.
Reuters also imposes a “joint and several contribution” equal to 50% of the net proceeds from these transactions if the parties fail to reach an agreement on a “fair and transparent level of fees” by March 31. added.
But amid the ongoing political debate, one payments expert argues that cash still comes with hidden costs.
“Physical cash movements are inherently less secure and harder to track. From a purely economic standpoint, when you factor in the time and resources to accomplish this, it’s likely that someone actually It’s actually more costly because you have to go to the bank or transfer money.You deposit cash at the center and vice versa on the other side,” says Spencer Hanlon, head of travel at high-tech payments company Nium. said Mr.
“In other words, cash has many advantages and disadvantages that ultimately drive up prices for consumers and reduce the quality of protection and experience.”
