Cash Isn’t King?

Posted on Mar 5, 2019 by

When I was a kid I remember when we would go to the grocery store and we would pay cash for our wares. It was a big deal when the store started accepting checks. Then, a few years later, the store started accepting credit cards.

As a business owner, I’m not too fussy about how our clients want to pay: cash, a check or a credit card are all absolutely fine.

Some businesses, however, have more discerning tastes.

Last month, the Philadelphia city council passed a measure that requires businesses to accept cash. As silly as it sounds, some retailers have a model that would have cashless locales. Because of the new legislation, online juggernaut Amazon is now threatening to scuttle plans to build a physical ‘Go’ store in Philadelphia that would have been cashless.

Amazon currently has 10 Go stores in Chicago, San Francisco and Seattle, and plans to open as many as 3,000 in the next two years. The stores only accept digital payments, as they have no cashiers. Customers select items electronically and the outlet’s sensors and automation software retrieve those items. The customer then pays digitally without having to wait in long checkout lines.

Amazon is not alone. Other establishments, like restaurant chains Union Square Hospitality Group, Dos Toros, Dig Inn and Sweetgreen, have also stopped accepting cash payments. The businesses claim the cashless model reduces overhead due to less staff, resulting in lower prices for customers. Customers have shorter waits with no checkout lanes and the likelihood of being robbed decreases rapidly when there is no cash on hand.

Not everyone is in favor of the trend, however. Supporters of the measure claim the cashless model discriminates against low-income consumers who are less likely to pay for items with credit or debit cards. In addition, consumer advocates claim some shoppers who lack checking or savings accounts, or those who can only qualify for pre-paid cards with high fees or interest rates, will have a much more difficult time utilizing cashless stores.

These disadvantaged shoppers could include victims of domestic violence, the homeless, and undocumented immigrants. In 2017, a report by the Federal Deposit Insurance Corporation estimated that 6.5% of American households were “unbanked.” Finally, proponents of the bill cite that shoppers using cash don’t have to worry about privacy issues or data security.

The City of Brotherly Love is not alone. In addition to Philadelphia, New York, New Jersey and Washington D.C. have all introduced legislation that would require retailers to accept cash. Massachusetts is the only state to adopt an outright ban on cashless stores. Surprisingly, the law was passed in 1979, decades before digital payment existed.

The measure currently awaits the mayor’s signature. If signed, any business that refuses to accept cash could be fined up to $2,000.

While I understand the trend, I’ll never comprehend refusing to take cash from a willing and able customer. But I’m also pretty sure these stores weren’t built with me in mind.



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Reg P. Wydeven

Elder Law and Estate Planning Attorney at McCarty Law LLP
Hoping to follow in his father’s footsteps from a young age, Reg’s practice primarily consists of advising individuals on estate planning, estate settlement and elder law matters. As Reg represents clients in matters like guardianship proceedings and long-term care admissions, he feels grateful to be able to offer families thorough legal help in their time of need.
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