Slovakia Codifies Cash Usage in Constitution – Protecting Financial Sovereignty
Slovakia has taken a significant step to safeguard its financial sovereignty by passing a parliamentary vote on June 15 to amend the nation’s constitution and establish the right to use cash as a payment method. The amendment, sponsored by the “We Are Family” party (Sme Rodina), comes as a precautionary measure in response to concerns over the proposed digital euro.
Legislator Miloš Svrček, one of the co-authors of the legislation, emphasized the importance of this constitutional provision during a parliamentary debate:
“It is very important that there is a provision in the Constitution based on which we can defend ourselves in the future against any orders from the outside, saying there can only be digital euro and no other payment options.”
In addition to codifying the right to use cash, Slovakia will also introduce constitutional amendments to protect shopkeepers’ rights to refuse cash payments for goods and services. This measure aims to address concerns related to robbery risks and potential exposure to germs. It will also provide an exception to existing cash-acceptance laws for shops offering card-only vending machines.
The European Union has been exploring the concept of a central bank digital currency (CBDC), commonly referred to as the digital euro. While some analysts view it as a “solution looking for a problem,” they recommend the EU to be prepared for further exploration in the future.
One of the main points of contention surrounding the potential development and implementation of a digital euro is its centralized nature, which raises concerns about privacy and control. Critics argue that a single government entity controlling transactions poses inherent threats to personal privacy.
Furthermore, the competition aspect cannot be overlooked. While CBDCs could benefit individuals with limited access to traditional banking services by eliminating account premiums and transaction fees, they pose a potential challenge to companies and private sector banks that profit from providing credit solutions to the underbanked.