As Popularity of Digital Payments Rise, Advocates Fight To Preserve Cash Payment Options

An ever-shrinking number of Americans who like to pay their way with cash are finding themselves on the defensive, often rebuffed at checkouts and kiosks when they pull out their once-revered paper money.Many professional sports stadiums have joined the growing list of businesses across America that no longer accept cash, adding to a list of outlets that includes airlines, concert halls, parking garages and many lunch spots. But now a diverse collection of advocacy groups is fighting back on behalf of the embattled greenback, pressing for federal legislation to require businesses to continue to accept cash.“We are not saying you can’t use your credit card or debit card,” says the executive director of the Consumer Choice in Payment Coalition, which includes groups ranging from merchants to labor unions to the NAACP.“We just want to give the consumer the choice to use cash or credit card or debit card,” Jon Alexander told The New York Sun. “It’s kind of a strange situation that we’re actually in that position that we’re advocating for that. You think, inherently, that you pull out your wallet and give money, somebody accepts it for a transaction, but in effect, oftentimes it doesn’t happen.”The trend toward a cashless economy accelerated during the Covid pandemic but has been underway for years. In July, the Federal Reserve’s annual Diary of Consumer Payment Choice report found that debit and credit cards now account for two-thirds of all payments made by Americans. Consumers made an average of just six cash payments a month last year, down from 14 a month in 2016.Younger consumers are especially likely to eschew cash, with 18- to 24-year-olds averaging just two cash payments a month last year, the report said. That compares to an average of 10 monthly cash payments by persons aged 55 and older. Rural residents also reported using cash more frequently than urban dwellers, a pattern the Fed says is becoming more pronounced.Nevertheless, cash money is not yet going away, though the amount of new cash being printed is declining. The Bureau of Engraving and Printing last year printed a total of 4.7 billion banknotes with a total value of $92.3 billion, the lowest ever in both categories, according to the Federal Reserve. The previous two years, with notes totaling $146.1 billion and $162.4 billion respectively, were also among the lowest ever.About 75 percent of consumers say they still carry cash in their pockets, purses, or wallets, with the average amount totaling $69. Nearly half of consumers say they keep an average of $364 in cash available for savings or emergency purposes. Only about 5 percent say they have stopped using cash altogether.Mr. Alexander says there are numerous reasons people still use cash. Nearly 5 percent of American households — many of them with lower incomes — do not have checking or saving accounts and rely on cash. Other consumers want to avoid fees or credit charges associated with digital payments.Mr. Alexander also points out that consumer buying habits can be tracked by credit or debit card use, prompting some Americans to prefer cash in order to avoid receiving unwanted advertising. “The anonymity of cash is really important. Not in a nefarious way, but in a very positive way,” he says.Some politicians are listening. Senators John Fetterman and Kevin Cramer introduced the Payment Choice Act last year to preserve payment options for consumers. The legislation would ensure customers can continue to use cash as a form of payment and are able to do so without being charged higher prices.“It’s simple: if you’re open for business in America, you should take U.S. dollars,” Mr. Fetterman said.Mr. Alexander says the National Retail Federation has opposed the legislation along with a similar bill in the House, and the initiative has stalled. “NRF opposes federal mandates to accept cash because they are unnecessary and restrict merchant choice,” the National Retail Federation’s vice president of government relations, Dylan Jeon said in an emailed statement. “The decision to accept cash should be up to each merchant based on what best fits their business model and should not be a government mandate. The majority of NRF’s members accept cash, and cash is usually the cheapest form of payment to accept.”But some states are moving ahead on their own.In March, a new law went into effect in New York requiring all stores and restaurants to accept cash for in-person purchases. The law also stipulates that businesses cannot charge consumers a higher price if they pay in cash. New Jersey, Massachusetts, and Rhode Island have similar laws on their books and some cities across the country have enacted their own cash payment requirements.The cash-requirement laws do have a loophole. Stores or venues can avoid accepting cash as long as they have a no-fee device on site to convert cash into a prepaid debit card. Mr. Alexander is not opposed to that workaround but says the process is making people jump through a hoop and may leave them with multiple cards with just a few dollars or cents loaded onto them.“We don’t think it’s much of an imposition of a retail merchant to have both cash and credit or debit,” Mr. Alexander said.This article has been updated to include a statement from the National Retail Federation.

As Popularity of Digital Payments Rise, Advocates Fight To Preserve Cash Payment Options

As Popularity of Digital Payments Rise, Advocates Fight To Preserve Cash Payment Options

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