Why you should not rely on paying with your credit card in Greece

Paying by card is not as common in Greece as in other countries. Although quite a few places do allow card payment, some may not. Cash is the norm for many smaller Greek shops, restaurants, and hotels. When traveling in Greece, you should never solely trust your card. Always carry real money with you instead.

Going around Athens or Thessaloniki, a card will be accepted almost everywhere. However, as soon as you leave the big cities, there is a big possibility you will feel broke when not carrying cash. Smaller shops, taverns, hotels, beach bars, and even gas stations only allow cash payment in Greece.

Why the Greeks prefer cash

You might believe these areas of Greece are behind on modernization. But this is not the case. Every shop or tavern, every business that requires payment, has a terminal that allows you to pay by card. They are obliged to have one. The technology is there. The problem is the Greeks who refuse to use it.

Let’s say you go to a traditional tavern to eat souvlaki. The waiter here can serve you this for 5 euros. The owner makes a profit on this price, and you feel you’re not overpaying him. Great! But only if you pay in cash.

If these 5 euros are paid by card, you have to pay an additional 9% on tax. The tavern has to spend this 9% extra on its suppliers. And the employees have to pay at least 9% of their income. In the end, the price of the souvlaki will go up to 6 or 7 euros. So why pay extra and make things much more complicated?

Maybe you say, what is one euro extra? But this one euro for you makes, a big difference to the waiter that serves you souvlaki. He might not make more than 500 euro’s a month, and for him, taxes do count! If you pay your 5 euros in cash, this money goes into the tax-free profit of the tavern. With enough of these black souvlakia, the tavern owner can pay your waiter his salary in cash, and because this man does not have to pay taxes over his income, he can make it till the end of the month. If you would have paid by card, he might have gotten a slightly higher legal salary. However, over this salary has to spend such a big amount on taxes that he will not survive.

Tax evasion is a cultural norm

The reason the Greeks prefer cash payment is tax evasion, a cultural norm in Greece. You get things cheaper, the company gains more profit, and its employees have more money to spend. They will again buy at a lower price without paying tax, creating a new circle of profit. Everybody is happy, except for the government.

While Greece is amongst the countries with the highest tax rates, tax income is below average. Over the past years, the government tries hard to make its citizens pay taxes. It is for example no longer possible to live cheaply in an unfinished house. Business owners need to have a payment terminal. And people need to show that they spend at least 30% of their income on non-tax-free buying.

I guess the result is the broken terminal for tourists. Partly businesses are paying taxes, and people are spending money on taxes. However, when the books look legit and non-tax-evasive, the machine breaks. Profit increases and undeclared employees are paid. And these are the people for whom you should not be paying with a card in Greece.

Life in Greece got too expensive

During the crisis, people had to pay almost the same amount on taxes as did before. However, incomes have significantly decreased. The minimum wage was reduced, from roughly 900 euros in 2011 to only 680 in 2012. Still having to pay the same amount of money on taxes, the Greeks with a low income could not survive. As a result, their employees started to pay them in cash. This way, businesses were more likely to not go bankrupt during the difficult years, they could save money on salaries. However, almost 30% of the people working undeclared in Greece, asked themselves for their employees to allow it, just to be able to survive. Unfortunately, till today the lowest incomes in Greece can not afford life and for many, avoiding taxes is the only way to make it till the end of each month.

A vicious circle

I don’t say that what is happening in Greece concerning tax evasion and undeclared incomes below the minimum wage is good. The best would be if everyone could pay taxes and have enough money to rent a house and buy clothes and food. Unfortunately, this is today still not the case. Greece is in debt, asks for too much money from its citizens, and as a result, they will find ways to avoid paying. But if the government doesn’t lower the tax rates, the Greeks will keep finding ways to make black money. On the other hand, if the citizens don’t start paying the government, the tax rates will not drop.

Who will give in first? Greeks are stubborn, so finding a way may take a while. Slowly they will, and one day you will be able to use your card for paying anywhere in Greece. But until that day comes, make sure to carry cash.

2022 Update

This year, more shops and taverns in Greece allow you to pay by card. Especially on the more touristic islands, cards are accepted payment for almost anything. However, still there are occasions when you do need cash. Smaller family taverns, small apartment rentals, or even kiosks still try to avoid the tax-system. Although cash is not as needed as it used to be, still always carry some with you!

Frequently asked questions:

What is the currency in Greece?

Greece is part of the European Union and since 2001, this is when Greece adopted the euro.

Is paying by card accepted in Greece?

Not all around Greece. In Athens and Thessaloniki, a card will be accepted almost everywhere. However, as soon as you leave the big cities, card payments get might not be accepted. Always carry some cash with you, and before you order at a tavern, it might be smart to check if you can pay by card.

Where can I find ATMs in Greece?

In bigger cities in Greece, ATMs can be found in almost every shopping street or public square. In smaller villages or islands, the main square is where you can usually find an ATM.

How much does it cost to live in Greece?

How much money do you need to live in Greece? To be able to pay rent, go to a tavern once in a while, and live comfortably in Greece, you will need around 1.000 euros per person per month. In the bigger cities, however, prices are much higher. So here count on at least 2.000 euros a month.

If you have any other questions regarding payment in Greece, please leave a comment below, we’re always happy to help!

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