New York Proposes Bill That Would Force Merchants to Accept Cash15th January 2019
‘25% of New Yorkers are underbanked’, according to NYC Council Member Ritchie Torres, who believes that these people, along with unbanked and people with no credit options, are being excluded by retailers who refuse to accept cash payments. Torres joins a list of politicians who are aiming to put a ban on the growing cashless trend.
Sen. Nellie Pou (D-Passaic) from New Jersey is sponsoring proposed legislation that would require all brick-and-mortar retailers in the state of New Jersey to accept cash payments. The bill is aimed at protecting consumers who still rely on cash to pay for goods and services, many of whom are unbanked and are unable (or prefer not) to access credit.
The legislation is a reaction to the card industry’s cashless push. In Washington D.C., Councilmember David Grosso introduced a bill, The Cashless Retailers Prohibition Act of 2018, that would require all D.C. restaurants to accept cash. Many restaurants in D.C. currently don’t accept cash, something Councilmember Grosso argues is “… discrimination against customers who prefer to use cash or do not have access to credit cards.” In 2017, Visa’s Cashless Challenge encouraged small businesses to explain how going cashless could benefit their business for a chance to be one of 50 winners to receive $10,000 from Visa. Shake Shack tried (and ultimately failed) to roll out a cashless policy at many of their stores earlier this year but was met with resistance from customers who still wanted a cash payment option.
As cash becomes more and more expensive to accept – rising fixed costs are combining with falling volumes to raise prices for merchants – it’s no wonder that many retailers are considering a move towards cashless trading. However, according to a recent CreditCards.com survey, cash still accounts for 31% of consumer transactions and is the preferred payment method for transactions under $10.
It looks like cash is here to stay for the foreseeable future, so merchants must consider ways to mitigate against rising costs rather than limiting customer payment choice.