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Greece wants to start charging people for cash withdrawals to prevent a run on banks

The government hopes to raise up to €180m in fees

Hazel Sheffield@hazelsheffield
Thursday 07 May 2015 00:26
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Pensioners were left queuing for hours over a hold up to pension payments
Pensioners were left queuing for hours over a hold up to pension payments

The cash-strapped Greek government has introduced a surcharge at cashpoints to prevent Greek citizens from withdrawing their cash.

Government ministers told The Times they hope to raise €180 million, or €1 for every €1000 transaction, through the scheme, though they are yet to get European Central Bank approval for it to go ahead.

A senior finance ministry official said: “The surcharge is just one of a grab-bag of measures we are considering if things get tough.”

Withdrawals exceeded €15 billion in the run up to the February elections that catapulted Alexis Tsipras and the far-left Syriza government to power. Greek residents were reported to have stashed wads of money behind bathroom tiles and under floorboards.

In the economic uncertainty since, that total has been pushed to €28 billion withdrawn, taking cash revenue to a 10-year-low.

The cashpoint plan surfaced on the same day the European Commission slashed Greece’s 2015 growth forecasts from 2.5 per cent to just 0.5 per cent , pushing the country’s debt-to-GDP ratio to 180 per cent.

Greece is locked in bail-out talks with the European Union and must agree a set of reforms before further money can be released.

Greece met a €200 million interest payment on May 6, but a further €750 million bill to the IMF due May 12 could prove problematic unless funding is secured.

The delay is taking its toll on the Greek people. Pensioners have been left queuing for hours over a hold up to pension payments, while some payments for medical staff have not been received. Hospital suppliers, who provide bandages and vital machinery to hospitals, have warned that they may not able to continue deliveries.

“In the past four months we are experiencing an undeclared suspension of payments,” an association for hospital suppliers said in a statement seen by the BBC.

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