- Italy blocked payments through cash machines and by credit cards in Vatican City
- Follows the world's smallest state's failure to fully comply with anti-money laundering rules
A stand-off between two titans of finance, the Bank of Italy and the Vatican, has forced tourists to abandon their visits to the Sistine Chapel -- unless they have cash in their pockets.
Italy's central bank has blocked all electronic payments through cash machines and by credit cards in Vatican City following the world's smallest state's failure to fully comply with international anti-money laundering rules.
The incident raises further questions about the transparency of the Vatican's finances. Its efforts to adopt international standards in combating money laundering and terrorist financing were given a mixed assessment last July in a study of its financial system.
Deutsche Bank's Italian division, which runs a network of cash machines for the Vatican, was refused authorisation from the central bank to continue operating its services within the walled state from the start of the year. The Vatican is not included in the European Commission's "white list" of states that fully comply with international standards against tax fraud and money laundering.
In a tightly worded statement, Father Federico Lombardi, head of press relations at the Holy See, said the use of the cash machines inside Vatican City was "at the point of expiry".
"Discussions are under way with other providers and we foresee that the interruption to credit card services will be short." A person familiar with the matter said a new provider could be announced on Monday.
A report by Moneyval -- Council of Europe experts who examine measures to counter money laundering -- last year passed the Vatican in nine out of 16 core recommendations.
It said the city state had to address important issues to demonstrate that a fully effective banking regime existed in practice, signally that it could be a lengthy process before the city state met the standards necessary to be accepted into the white list of countries.
A message on the Vatican Museums website apologises to visitors for any inconvenience, blaming "reasons beyond the control of the directorate of museums".