Philadelphia Becomes the First U.S. City to Ban Cashless Stores
This week, Philadelphia became the first U.S. city to ban cashless stores, The Wall Street Journal reports. As of July, most businesses will be required by law to accept cash (exceptions will be made for parking garages, wholesale clubs like Costco that sell through a membership model, and hotels and rental-car companies where customers have to put down a credit card deposit).
The debate surrounding cashless businesses—those that require payment by debit or credit card—has been escalating steadily, thanks to their recent proliferation and the accompanying media attention they've received. (Amazon Go, Dig Inn and Sweetgreen, who have all adopted a cashless model, are often mentioned.) Massachusetts has had a law requiring stores to accept cash since the 1970's, and just last month, New Jersey also passed a bill banning cash-free establishments. A New York City councilman is currently pushing similar legislation, although nothing has been signed into law just yet.
Those in favor of requiring stores to accept cash argue that going cashless has classist implications—there can be hurdles to obtaining a debit or credit card. “Most of the people who don’t have credit tend to be lower income, minority, immigrants. It just seemed to me, if not intentional, at least a form of discrimination,” Philadelphia Councilman William Greenlee told The Wall Street Journal. As the paper notes, 26 percent of Philadelphia residents live below the poverty line, and many don't have bank accounts. Greenlee also said that local stores will now be required “to do what businesses have been doing since Ben Franklin was walking the streets of Philadelphia.”
But businesses that have gone cashless point to improved safety and efficiency—workers no longer have to carry large bank deposits, and transactions tend to be faster. Other supporters—a camp which includes The National Retail Federation and The Chamber of Commerce for Greater Philadelphia— argue that cashless businesses are the future, and banning them doesn't advance the issue of getting low-income people access to cash-free payment methods.
Philadelphia restaurant owners have already started adopting the new legislation. Steven Cook, co-owner of falafel shop Goldie, will begin accepting cash at all three outposts shortly. He told the WSJ, "I don’t think it’s great policy, but it’s not going to be make-or-break for whether our business is successful.”