In Italy, there are many common payment instruments (cash, bank/postal check, cashier’s check, bank/wire transfer, credit/debit/rechargeable cards, postal or bank order). It is possible to pay in cash sums not exceeding € 2,999.99 with reference to “transfers” made for any reason between different individuals or legal entities. The transfer of amounts equal to or greater than € 3,000 can be carried out through banks, Poste Italiane S.p.A., electronic money institutions and payment institutions. This rule applies to whoever (Italians/EU citizens) is making a payment in the country, with some exceptions. Debit cards are common in Italy since they are accepted throughout the country by almost every commercial activity and usually are cheaper than credit cards. Wire transfers are also a common means of payment.
1) Payment instruments
In Italy, it is possible to use various payment instruments. The most common ones are listed here below:
cash (banknotes and coins) (see below);
debit card/ATM (bancomat);
postal or bank order.
2) Limit to the use of cash
It is possible to pay in cash sums not exceeding € 2,999.99. Under Legislative Decree 231/2007, art. 49, par. 1, as recently amended (by the Stability Law 2016), it is prohibited to transfer cash (or bank or postal bearer passbooks or bearer securities that are in Euros or in a foreign currency) when the value to be transferred is overall equal to or greater than € 3,000.n1 This rule applies to “transfers” made for any reason between different individuals or legal entities.n2
The transfer is forbidden even when it is performed with multiple payments below the threshold that appear to be artificially fractioned.
The transfer of amounts equal to or greater than € 3,000 can be carried out through banks, Poste Italiane S.p.A., electronic money institutions and payment institutions.
This limit to the use of cash is in part due to the attempt to trace payments for tax issues, such as fighting tax evasion, and in part are intended to curb corruption and crime, for example money laundering and terrorist financing.
In case of violation of the provisions contained in art. 49 (par. 1, 1-bis, 5, 6 e 7), the offender shall be punished with a fine ranging from 1% to 40% of the transferred amount, but that cannot be in any case lower than € 3,000. If the amount transferred in cash exceeds € 50,000 the sanction ranges from 5% to 40%.n3
Reading the provision in question (art. 58) it seems that the pecuniary sanction applies only against the payer. However, as art. 49, par.1, refers to “transfers” made for any reason between different individuals or legal entities, some authors believe that even those who receive the money are punishable under the same article. In any case, considering that the rule is not very clear on this point, it appears possible to appeal the fine before the competent authority in case of sanction against the one who receives money in an amount that is greater than € 3,000.
4) Rules applying to the use of checks
Banks and Poste Italiane S.p.A. can issue bank and postal checks bearing the non-transferability clause (the bank check can be paid only in favor of the recipient and cannot be “endorsed” in favor of another subject), even though customers may request, in writing, that checks are issued without the said clause (in this case the applicant must pay a stamp duty of € 1.50).
Bank and postal checks issued for amounts equal to or greater than € 3,000 shall contain the non-transferability clause and the indication of the name or business name of the beneficiary.n4
Cashier’s checks, postal orders, and promissory notes are issued with the indication of the name or business name of the beneficiary and the non-transferability clause (if the amount is lower than € 3,000 it is possible to ask not to apply the non-transferability clause).
5) Credit/debit/rechargeable cards and wire transfers
A credit card is (usually) issued to the holder of a bank account with the repayment mode consisting of a single payment at balance the month after the purchase. However, the account holder can choose to pay for a single purchase, a group of purchases or any purchase during the month, in installments or ask for monthly installments for all purchases incurred during the month, using the method of repayment called “revolving” (for which he will have to pay an interest rate). Costs, terms and conditions, etc. of credit cards vary from bank to bank.
Debit cards are very common in Italy since they are accepted throughout the country in almost every commercial activity, such as hotels, restaurants, and stores. They are the best tool for the withdrawal of money from ATMs (bancomat), and usually are cheaper than credit cards in terms of monthly/annual fees.
Rechargeable cards have recently had a significant spread especially for those who intend to purchase online. Many banks and the Poste Italiane S.p.A. offer this kind of card at a very low cost. Most of these cards allow holders to make traditional and online payments, wire transfers, and also to pay bills among other things. Also in this case costs, terms and conditions, etc. of rechargeable cards vary from bank to bank (or Poste Italiane S.p.A.).
The Stability Law 2016 has established that retailers (of products and services) and professionals are obliged to accept payments made through debit and credit cards, including micro-payments; this obligation does not apply in cases of technical impossibility.
Wire transfers are also a very common means of payment in Italy. Considering that it is not possible to pay cash amounts greater than € 2,999.99, salaries, traditional and online purchases, deposits, taxes, utilities, services, etc. are often paid by wire transfers.
It is possible to make a wire transfer either by going to the bank where the payer holds his bank account or online (in this case the “internet/mobile banking” option is required). Costs of wire transfers vary from bank to bank and usually go from € 1.10 to € 4 per each transfer.
6) Extinguishing a debt under articles 1277 and 1278 of the Italian Civil Code
According to art. 1277 of the Italian Civil Code monetary debts are extinguished by legal tender in the State at the time of payment and at its nominal value. If the amount due is determined in a currency that is not legal tender in the State, the debtor has the right to pay in legal currency, at the rate of exchange on the day of the deadline and in the place of payment (art. 1278 of the Italian Civil Code).