Cash

• What they are
• Interested parties
• Strengths and drawbacks
• Expenses
• Underlying rules
• Pitfalls

What they are

The term 'cash' refers to banknotes and coins. By law, cash must be universally accepted, although there are two important exceptions (see 'Underlying rules' below).

Coins and banknotes can be counterfeited, so you should learn about their security features to be able to tell whether they are authentic.

To learn more, visit the European Central Bank's website.

Interested parties

Those who have to pay small sums or do not have alternative means of payment.

Strengths and drawbacks

Unlike other means of payments, when you use coins and banknotes you immediately extinguish your debt. No more than 50 coins are required to be accepted in any single payment.

You run the risk of loss or theft when you carry large quantities of banknotes or coins around with you. There is no system for proving ownership of cash, as there are for other means of payment, nor it is possible to 'freeze' it, as you can with a stolen or lost payment card.

Expenses

People don't know how much cash costs them directly.

The central bank system, as well as the banking and postal systems (as regards circulation only) bear the costs of producing, handling and circulating cash.

Underlying rules

In Italy, cash can't be used to pay sums equal to or above €5,000. It is forbidden! So you have to use other payment instruments instead.

Remember, too, that when you pay with coins, the payee is not obliged to accept more than 50 coins in any single payment.

Pitfalls

Banknotes and coins can be stolen, lost, damaged or destroyed. In short, they can go astray, so don't keep them under your mattress!