EN ECB -PUBLIC  
 
OPINION OF THE EUROPEAN CENTRAL BANK  
of 12 November 2021  
on the obligation to accept cash payments  
(CON/20 21/32) 
 
Introduction and legal basis  
On 20 October 2021 , the European Central Bank (ECB) received a request from the Danish Financial 
Supervisory Authority for an opinion on  a draft law amending the Law on financial services , the Law on 
capital markets , the Law on payments , and various other laws1 (hereinafter the ‘draft law’) . 
The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the 
Functioning of the European Union (TFEU) and the first, second  and third in dents of Article  2(1) of Council 
Decision 98/415/EC2, as the draft law relates to  currency matters, means of payment, and Danmarks 
Nationalbank . In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the 
European Central Bank, the Governing Council has adopted this opinion.  
 
1. Purpose and description of the draft law  
1.1 The draft law proposes to regulate the so -called ‘ cash rule’ under the Law on payments , which  
obliges  payment recipients to accept payments in cash. Under the current cash rule,  vendors are 
obliged to accept payments in cash in the case of physical transactions , except for narrowly defined 
cases . These are d istance sales, such as sales via the internet, and sales via self -service vending 
machines , which are exempt from the cash ru le. Moreover, in areas with a particularly high risk of 
robberies, the cash rule only applies between the hours of 0 6:00 and 20: 00 provided that the 
Financial Supervisory Authority has been notified in advance of the intention not to apply the cash 
rule. T he obligation to notify  is a purely administrative measure and does not imply that the vendor 
obtains an author isation from the Financial Supervisory Authority3. 
1.2 The draft law proposes to restrict the cash rule by allowing payment recipients to derogate from the 
cash rule in respect of payment s from payer s who are not consumer s. In this context  it is left to the 
parties ’ freedom of contract to agree the means of payment applicable. According to the explanatory 
 
1  Forslag til lov om ændring af lov om finansiel virksomhed, lov om kapitalmarkeder, lov om investeringsforeninger m.v. 
og flere andre love . 
2  Council Decision 98/415/EC of 29  June 1998 on the consultation of the European Central Bank by national authoritie s 
regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42).  
3  The legal tender status of Danish kroner  banknotes and coins is laid down in Article 8.2 of the Law on Danmarks 
Nationalbank ( Lov om Danmarks Nationalbank, Lov nr. 116 af 7. april 1936,  som ændret ved lov nr. 166 af 13. april 
1938, § 44 i lov nr. 88 af 15. marts 1939, lov nr. 67 af 15. marts 1967, § 90 i lov nr. 174 af 30. april 1969 og § 16 i lov 
nr. 579 af 1. juni 2010 ) and Article 4.1 of the Law on coins ( Lov om mønter, Lov nr. 1803 af 12. december 2018) . Thus, 
the cash rule under the Law on payments is a separate statutory obligation.  
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2 notes  on the draft law4, the proposal seeks to balance the need to avoid unnecessary  burdens on 
professional payment recipients , whilst maintaining the right for consumers to pay by means of cash. 
Moreover, the restriction applies only for a specific individual transaction,  and therefore not , for 
example,  where the payment recipient also sells products or services to consumers. The explanatory 
notes explain  further  that, although Danish people use less cash than before, there are still 
consumers who need to be able to pay by means of cash, for which reason the preservation of the 
general obligation to receive cash as a means of payment is appropriate. However, these  
considerations  are not considered pertinent for payments between professionals.  
1.3 The draft law contains  a further proposal to restrict the cash rule as regards  payment recipients  
participating in festivals, town celebrations and similar events of a temporary nature5. For such 
events the acceptance of cash may be refused if the following cumulative conditions are fulfilled : (a) 
the event has a maximum duration of 14 days ; (b) the event takes place  not more than once a  year; 
(c) the event takes place within a geographically  limited area subject to access control s; and (d) the 
event organi ser informs consumers  of the cash restriction in a clear manner prior to their registration  
for the event. Where no registration is required, the event marketing must inform consumers  of the 
cash restriction in a clear manner. The proposed rule disapplies the cash rule requiring the 
acceptance of cash.  However, t his does not mean that such events are prevented from accepting 
cash if they so wish. According to the explanatory notes6, based on his existing restrictive authority 
to grant dispensations from the cash rule,  the Minister for Business has developed a practi ce 
whereby payment recipie nts who participate in an event with a short duration, taking place not more 
than once a year , and located within a limited area, can be authori sed to derogate from the cash 
rule7. The explanatory notes further explain8 that the draft law  thus codifies the administrative 
practice developed by the Minister, without making material amendments to the cash rule itself. The 
advantage is considered to be the administrative relief for professionals taking part in events, 
festiv als, etc., who will no longer have to apply for a derogation from the cash rule if they wish to 
restrict the acceptance of cash during all hours of the day . The explanatory notes emphasise that 
recurr ing events , such as  football matches i n a sta dium or events in concert halls , are not included 
in the scope of the new restriction.  
1.4 Accordi ng to the explanatory notes to the draft law9, the provisions regulating cash free payments 
during the evening and at night have proven to work in accordance with the policy inten tion. 
Nonetheless , the draft law proposes to abolish the obligation to notify the supervisory authority of the 
intention  to apply reduced hours  of cash acceptance, i.e.  from 06:00 to 20:00, in areas with a 
 
4  See points 1 and 2.10.1 of the general comments and page 124 of the specific comments on the draft law.  
5  See paragraph 1.3 of Opinion CON/2021/18.  All ECB opinions are published on EUR -Lex. 
6  See point 2.10.1 of the general comments on the draft law.   
7  According to point 2.10.1 of the general comments on the draft law, the authorisation to make dispensations was 
delegated to the Financial Supervisory Authority in 2020, which since then has exercised that power in accordance 
with the practice developed  by the Minister.  
8  See page 124 of the speci fic comments on  the draft law.  
9  See point 2.10.1 of the general comments on the draft law.  
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3 particularly high risk of robberies, without amending the cash rule as such10. Accordi ng to the 
explanatory notes11, the proposal is made with a view to eas ing the administrative burdens linked to 
the obligation to notify the supervisory authority  in advance of the intention to apply restricted hours 
during which cash must be accepted as a means of payment.  
1.5 Finally, the draft law also makes proposals on the designation of national competent authorities as a 
consequence of Regulation (EU) 2021/23 of the European Parliament and of the Council12 on a 
framework for the recovery and resolution of central counterparties and expands the competence of, 
inter alia, Danmarks Nationalbank to impose public administrative fines on persons and entities 
operating registered payment systems  under the Law on capital markets13.  
 
2. General observations  
Role and importance of cash payments in society  
2.1 Electronic payment instruments are increasingly used as the preferred form for retail payments in a 
number of Member States , including Denma rk14. In this respect, Denmark is currently among the 
most digitalised countries in the world15, which, inter alia, enables the use of alternative means of 
payment . While in 2009 cash payments accounted for 48% of the total number of payments in 
physical trades in Denmark, the figure in 2019  was down to 16%16. 
2.2 Cash continues to play an important role in society . The ability to pay in cash remains particularly 
important for those who, for various legitimate reasons, prefer to use cash rather than other payment 
instruments , or do not have access to the banking system and electronic means of payments . Cash 
is general ly also useful as a payment instrument because it is widely accepted, fast and facilitates 
control over the payer’s spending. Moreover, it is the only payment instrument that allows citizens to 
settle a transaction in central bank money , which is also sett led instantly17. In addition,  the ability to 
pay in cash remains particularly important for certain groups in society that, for various legitimate 
reasons, prefer to use cash rather than other payment instruments. These groups include not only 
elderly people but also some disabled cit izens, immigrants, socially vulnerable citizens, minors and 
others with limited or no access to digital payment services18. However, the use of cash is declining 
 
10  For a list o f areas identified by the Ministry of Business as representing a particularly high risk for robberies see: 
https://em.dk/nyhedsarkiv/2017/november/nye -regler -goer-det-nemmere- for-butikker -at-beskytte -sig-mod-roeveri/ . 
For a list of entities that have  notified the  Financial Supervisory Authority that they intend to receive cash only during 
restricted hours, see :  
https://www.finanstilsynet.dk/Lovgivning/Information -om-udvalgte -tilsynsomraader/Betalingstjenester -og-e-
penge/Kontan treglen  
11  See point 2.10.1 of the general comments on the draft law.  
12  Regulation (EU) 2021/23 of the European Parliament and of the Council of 16 December 2020 on a framework for the 
recovery and resolution of central counterparties and amending Regulat ions (EU) No 1095/2010, (EU) No 648/2012, 
(EU) No 600/2014, (EU) No 806/2014 and (EU) 2015/2365 and Directives 2002/47/EC, 2004/25/EC, 2007/36/EC, 
2014/59/EU and (EU) 2017/1132 (OJ L 22, 22.1.2021, p. 1).  
13  Lov om kapitalmarkeder, lovbekendtgørelse nr. 37 7 af 2. april 2020.  
14  See paragraph 2.4 of CON/2020/33 .  
15  See the report by Danmarks  Nationalbank ‘Danes primarily opt for electronic payment solutions’, September  2020 , 
page 2.  
16  See the report by Danmarks Nationalbank ‘Cash payments are declining’, February 2020, page 9.  
17  See paragraph 2.4 of Opinion CON/2017/8; paragraph 2.1 of Opinion CON/2019/41; paragraph 9.2.1 of Opinion 
CON/2020/13; paragraph 2.3 of Opinion CON/2020/21; paragraph 7.2.1 of Opinion CON/2021/9 ; paragraph 2.1 of 
CON/2021 /18.  
18  See paragraph 1.5 of Opinion CON/2019/41.  
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4 in Denmark, also by elderly people . Cash payments as a share of the total number of payments 
broken down by age shows that in 2017 people in the age group 70- 79 years used cash in 40% of 
their payments in physical trades , and that this  number had declined to 22% in 201919. Taking this 
into account, t he ECB h as a positive view of further innovation and development in the field of 
electronic payment instruments, recalling that cash has a unique role, facilitat ing the inclusion of the 
entire population in the economy by allowing financial transactions to be settled in this way. 
Furthermore, cash could play an important role in the event of a disturbance in the payment system20 
and it is robust against cyber -crime.  In a crisis situation, such as the ongoing COVID -19 pandemic, 
the non- acceptance of cash at physical points of sale may be of particular significance to the elderly 
and people with disabilities, or anyone unable to access cashless means of payment, and who,  as a 
consequence,  could face serious difficulties meeting their essential needs.  
2.3 Against this background, the ECB strongly welcomes  the fact  that the draft law upholds the cash rule 
in Denmark,  and thereby preserves citizens' right to pay in cash.  
Status of euro banknotes and coins as legal tender  
2.4 Denmark is a Member State with a derogation from participating in the third stage of economic and 
monetary union21. Although Union law only regulates the legal tender status of euro banknotes and 
coins, the Union framework applicable to the legal tender status of euro banknotes and coins will 
become directly applicable in Denmark  if and when the euro is introduced in Denmark . Against this 
specific institutional backdrop, the ECB has prepared an assessment of the draft law’s provisions 
compared with relevant practices in the euro area, in particular as concerns the legal tender status 
of euro banknotes.  
2.5 Under the T FEU, the European System of Central Banks (ESCB) has the basic task of promoting 
the smooth operation of payment systems22, and the ECB has the exclusive right to authorise the 
issue of euro banknotes within the Union23. The euro banknotes issued by the ECB and the national 
central banks of the euro area are the only banknotes with legal tender status within the euro area24. 
2.6 The concept of ‘legal tender’ of a means of payment denominated in a currency unit has been 
considered by the Court of Justice of the European Union. In particular, the Court has clarified that 
the concept of ‘legal tender’ signifies that this specific means of payment cannot generally be refused 
in settlement of a debt , denominated in the same currency unit at its full face value, with the effect of 
discharging the debt. In clarifying the concept of ‘legal tender’ under Union law, the Court has taken 
into consideration Commission Recommendation 2010/191 of 22 March 2010 on the scope and 
effects of legal tender of euro banknotes and coins25, which provides useful guidance for the 
interpretation of the relevant provisions of U nion law. Point 1 of Recommendation 2010/191 states 
that, where a payment obligation exists, the legal tender of euro banknotes and coins sho uld imply 
 
19  See the report by Danmarks Nationalbank ‘Cash payments are declining’, February 2020, page 9.  
20  See paragraph 2.1 of Opinion CON/2019/41; paragraph 9.2.1 of Opinion CON/2020/13 and paragraph 2.3 of 
CON/2021/18. 
21  See Protocol (No 16) to the T FEU on certain provisions relating to Denmark.  
22  Article 127(2) T FEU and Article 3.1 of the Statute of the ESCB  and the ECB . 
23  First sentence of Article 128(1) T FEU and first sentence of Article 16 of the Statute of the ESCB  and the ECB . 
24  Third sentence o f Article 128(1) T FEU and third sentence of Article 16 of the Statute of the ESCB  and the ECB . 
25  OJ L 83, 30.3.2010, p. 70.  
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5 (a) mandatory acceptance of those banknotes and coins; (b) their acceptance at full face value; and 
(c) their power to discharge from payment obligations. According to the Court, this shows that the 
concept of ‘legal tender’ encompasses, inter al ia, an obligation in principle to accept banknotes and 
coins denominated in euro for payment purposes26. 
2.7 Insofar as it allows the Union  legislature to lay down the measures necessary for the use of the euro 
as the single currency, the Court clarified that Article 133 of the Treaty empowers the Union  
legislature alone to specify the legal rules governing the status of legal tender accorded to banknotes 
and coins denominated in euro, insofar as that is necessary for the use of the euro as the single 
currency. Such exclusive competence precludes any competence on the part of the Member States 
in the matter, unless they have been empowered by t he European Union to do so or for the 
implementation of Union acts27.  
2.8 However, the Court further clarified that the status of legal tender calls only for acceptance in principle 
of banknotes and coins denominated in euro as a means of payment, not for abs olute acceptance. 
The Union’s exclusive competence in matters of monetary policy is without prejudice to the 
competence of the Member States whose currency is the euro to regulate the procedures for settling 
pecuniary obligations, which do not affect the principle that, as a general rule, it must be possible to 
discharge a payment obligation in cash. Thus, that exclusive competence does not prevent a 
Member State from adopting a measure falling within one of the Member State’s competences ; for 
instance, a Member State can, based on its competence to regulate administrative procedures,  
oblige the public administration to accept cash payments from citizens. Neither does it prevent a 
Member State, in the exercise of its own powers, from introducing, on legitimate public interest 
grounds, a derogation from that obligation for statutorily imposed payments, subject to compliance 
with certain conditions. In particular, the obligation to accept euro banknotes and coins can, in 
principle, be restricted by the Member S tates for reasons of public interest and subject to the principle 
of proportionality. This means that any such restrictions need to be proportionate to the public interest 
objective pursued. When limiting the possibility, recognised by Union  law, of generally discharging a 
payment obligation in banknotes and coins denominated in euro, Member States must ensure that 
any measures comply with the principle of proportionality, which requires in particular that they are 
appropriate for achieving the legitimate o bjectives pursued by the legislation at issue and do not go 
beyond what is necessary in order to achieve those objectives28. The Court  has established that 
restrictions of the legal tender status of euro banknotes in particular require (i) that the legislation 
does not have the object or effect of establishing legal rules governing the status of legal tender of 
euro banknotes; (ii) that it does not lead, in l aw or in fact, to abolition of those banknotes, in particular 
by calling into question the possibility, as a general rule, of discharging a payment obligation in cash; 
(iii) that it has been adopted for reasons of public interest; (iv) that the limitation on payments in cash 
 
26  See judgment of the Court of Justice of 26 January 2021, Hessischer Rundfunk, C -422/19 and C -423/19, 
ECLI:EU:C:2021:63, paragraphs 46 to 49. 
27  See judgment of the Court of Justice of 26 January 2021, Hessischer Rundfunk, C -422/19 and C -423/19, 
ECLI:EU:C:2021:63, paragraphs 50 to 52.  
28  See judgment of the Court of Justice of 26 January 2021, Hessischer Rundfunk, C -422/19 and C -423/19, 
ECLI:EU:C:2021:63, paragraphs 55 to 56 and 67 to 70.  
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6 which the legislation entails is appropriate for attaining the public interest objective pursued; and (v) 
that it does not go beyond what is necessary in order to achieve that objective29.  
2.9 The ECB has provided additional guidance in it s opinions with respect to whether limitations may be 
considered to be proportionate. In particular, the ECB has noted that the broader and more general 
a limitation is, the stricter should be the interpretation of the requirement for the limitation to be 
proportionate to the objective pursued. When considering whether a limitation is proportionate, the 
adverse impact of the limitation in question and whether alternative measures could be adopted that 
would fulfil the relevant objective with a less adverse impact should always be considered30.  
2.10 Taking into account the foregoing, the ECB considers that the draft law  neither has the object nor 
the effect of amending the legal rules governing the status of legal tender of Danish kroner banknotes  
or coins , but on the contrary preserves citizens ’ right to fulfil their payment obligations by means of 
cash . Moreover, as regards the requirement that the measures must be  appropriate for attaining the 
public interest objective pursued, the ECB considers it a legitimate interest to create a legal basis 
allowing professionals in transactions they are conducting among themselves to opt , as part of their 
contractual freedom,  for non- cash payment forms.   
2.11 In the present context, the ECB observes  that the restrictions introduced by  the draft law  are not 
absolute. However, t he Court has highlighted that lawful alternative means of payment need to be 
readily accessible to everyone liable to pay31, and therefore hinted to the need for exceptions if the 
latter is not the case. With that in mind, the ECB considers the draft law in general to be proportionate  
noting, however, that as regards all provisions restricting the general rule facilitating payment in cash,  
in the case of contingencies where alternative means of payment are temporarily not functioning, 
flexibility should be ensured to facilitate settlement of  payment obligations in cash.   
 
This opinion will b e published on EUR -Lex.  
 
 
Done at Frankfurt am Main, 12 November 2021.  
 
[signed]  
 
The President of the ECB  
Christine LAGARDE  
 
29  See judgment of the Court of Justice of 26 January 2021, Hessischer Rundfunk, C -422/19 and C -423/19 , 
ECLI:EU:C:2021:63, paragraph 78.  
30  See paragraph 2.7 of Opinion CON/2017/8.  
31  See judgment of the Court of Justice of 26 January 2021, Hessischer Rundfunk, C -422/19 and C -423/19, 
ECLI:EU:C:2021:63, paragraph 77 .