America Legislates for Cash

Colorado and Connecticut are the latest U.S. states to make it illegal for businesses to refuse cash, but while the number of pro-cash laws is rising, so too is concern that they’re not always properly enforced.

Numerous states have introduced bills during the 2020/2021 legislative session to make it illegal for brick-and-mortar stores to refuse cash. According to a list from the ATM Industry Association Stateside Monitoring Service, states with pro-cash legislation now include Arizona, Delaware, District of Columbia, Idaho, Maine, Massachusetts, Michigan, Mississippi, New York, North Dakota, Oklahoma and Pennsylvania, as well as New Jersey and Rhode Island plus—most recently—Colorado and Connecticut.

Cities too have taken a stand for payment choice. It is unlawful for retailers not to accept cash in Washington D.C., Berkley, Chicago, New York City, Philadelphia and San Francisco. However, it is in the nation’s capital that the number of cashless businesses is rising faster than anywhere else in the country despite the law taking effect on 4 April 2021.

According to DC Line—a non-profit media organisation that covers local news in the capital—the reason for this is simple: D.C. officials delayed enforcement during the public health emergency, and have yet to allocate the $750,000 required to fund it over the next four years. Mayor Muriel Bowser opted not to include it in her 2022 budget proposal, nor was it raised at an early July budget work session.

In addition to ensuring full payment choice for all, DC legislators argue that cashless businesses are inherently discriminatory. This drove the Cashless Retailers Prohibition Amendment Act back in 2019, with then-Council member David Grosso observing that cash rejection ‘has become a nationwide trend, backed in some instances by credit card companies like Visa, which have provided short-term funding to businesses that agree to stop accepting cash from their customers.’

Data from Square—a financial services and digital payments company based in San Francisco—shows that the number of its clients that are completely cashless in the DC area has increased from 15 percent in 2019 to nearly 40 percent in 2021. Its full analysis excluded businesses that saw prolonged closures during the pandemic so, ultimately, of DC businesses using Square and remaining active throughout the health crisis, two-fifths are not accepting cash.