A completely cashless economy may be closer than you think

Inside Subprime: December 27, 2017

By Caroline Thompson

How much cold, hard cash do you have in your wallet right now? Even if the answer is “zero,” that doesn’t mean you’re broke. For many Americans, living a virtually cashless existence from day to day is completely normal. After all, in this progressively digital age, we have a lot of different options when it comes to paying for stuff. We can use a credit card, a debit card, Apple Pay, Google Wallet, PayPal, or even pay a friend back instantly through payment apps like Venmo and Zelle.

Those crumpled green bills in our pockets are becoming increasingly obsolete, and in a growing number of retail establishments across the country, they can’t buy you anything at all.

Back in July, credit card giant Visa announced it would be “awarding up to $500,000 to 50 eligible US-based small business food service owners who commit to joining the 100 percent cashless quest.” Essentially, Visa wanted to encourage small restaurant owners to stop accepting paper currency once and for all, and reward them with the money to make updates to their payment systems. A completely cashless world would benefit Visa and other credit card companies greatly, because according the U.S. Small Business Administration, credit lenders make a killing off credit card transaction fees.

While at the time, many in the industry were skeptical anyone would take Visa up on their offer, it seems that a number of restaurant chains have done just that. A new report from The New York Times demonstrates that, in New York City, cashless dining is indeed on the rise.

Several restaurants in the City straight-up no longer accept cash as payment for their food. While it may seem unbelievable, many cashless business owners say it’s actually helping – not hurting – their bottom line.

Leo Kremer, co-CEO of Mexican chain Dos Toros, told The New York Times that having to count cash took up a lot of unnecessary manager time, and often caused bottlenecks at the register. “There’s something fundamentally demoralizing when you have the leader of the restaurant back in the office, counting, instead of out on the floor,” he said.

Customers who try to pay with cash at these establishments are turned away, leading many to wonder whether or not a cashless business is even legal. Unfortunately for fans of legal tender, refusing to take cash is totally on the books.

According to the U.S. Federal Reserve, although the Constitution states that “United States coins and currency are legal tender for all debts, public charges, taxes, and dues. There is, however, no Federal statute mandating that a private business, a person, or an organization must accept currency or coins as payment for goods or services. Private businesses are free to develop their own policies on whether to accept cash unless there is a state law which says otherwise.”

While a cashless lifestyle might already be the norm for many Americans, universal adoption of this new ideal could spell disaster for low-income families. Without access to bank accounts, smartphones or credit cards, many people may soon find themselves with no way to buy daily necessities. Cashless living may be convenient for some, but if this is the world we’re not-so-slowly transitioning into, accessibility issues need to be front and center in the national conversation.

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