Monday, June 10, 2013

National Bank of Ukraine sets an upper limit on cash payments

On 6 June 2013, the Board of the National Bank of Ukraine adopted the Resolution on setting an upper limit on cash payments, which takes effect from 1 September 2013, the press office of the National Bank of Ukraine announced.

In accordance with the requirements of the above Resolution, settlements in cash carried out between enterprises (entrepreneurs) within one business day shall be limited to UAH 10,000. Cash payments for goods (works and services) between a natural person and an enterprise (entrepreneur) shall not exceed UAH 150,000. In addition, cash payments of up to UAH 150,000 are permitted between natural persons under purchase and sales agreements subject to notarization.
Natural persons are allowed to make payments exceeding UAH 150,000 by transferring funds from one current account to another one, depositing and/or transferring funds to current accounts, including notary's deposit account, or separate current account in national currency.
The Board of the National Bank of Ukraine has approved amendments to the Regulation on conducting cash transactions in the national currency in Ukraine. By virtue of recent amendments to the Regulation, if payments made against one or several payment documents between enterprises (entrepreneurs) and/or enterprises (entrepreneurs) and natural persons within one business day exceed the upper limit, they are to be made in cashless form only via banks or non-banking financial institutions that, in accordance with the procedure established by the law, have been granted licenses to transfer funds without opening an account. Enterprises (entrepreneurs) and natural persons are allowed to settle transactions with an unlimited number of counterparts within one business day.
"The main purpose of imposing restrictions on cash payments is to increase the volume of cashless payments and raise additional resources to boost lending to the economy. The growth in cashless payments will increase the inflow of financial resources of the economic agents to the banking system and enhance banks' liquidity. Restrictions on cash payments are expected to lead to lower levels of deposit dollarization and an increase in the use of cashless payments by natural persons. The reduced amount of physical currency in circulation (paper money and coins) will have a positive effect on the economy. We hope this measure will promote additional economic growth, boost national currency lending to the economy, and reduce the amount of foreign currency cash outside banks,” said Deputy Governor of the National Bank of Ukraine Vira Rychakivska.
The Resolution adopted by the Board of the National Bank of Ukraine on 6 June 2013 will come into effect after the state registration hereof with the Ministry of Justice of Ukraine.

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